Non taxable amounts generally fall into three categories:
- exempt income
- non-assessable non-exempt income (“NANE”), and
- other non-taxable amounts which don’t affect your tax return
The Tax Office provides an annually updated page detailing types of income received by individuals which are not taxed.
They are listed below.
For individuals see:
- Amounts not included as income 2023
- Amounts not included as income 2022
- Amounts not included as income 2021
- Amounts not included as income 2020
- Amounts not included as income 2019
- Amounts not included as income 2018
For businesses, see What to exclude from your business’s assessable income
Tax Treatment of Covid Relief Payments
Note that this list is not guaranteed to be complete. If your item is not listed, check with the Tax Office or a tax advisor.
|Government Payment||Tax treatment|
|Robodebt class action settlements||Not taxable or required to report|
|JobKeeper||Assessable income, no GST|
|Pandemic Leave Disaster Payments||Assessable income **|
|Employment payments||Normal tax tax treatment (salary, leave, redundancy etc)|
|Cash Flow Boost||Exempt|
|Unit Trust distributes Cash Flow Boost||Not taxable but CGT event E4 (cost base attribution)|
|Company distributes Cash Flow Boost (dividend)||Taxable as a dividend|
|Pandemic leave disaster payment to individuals||Assessable income, no GST|
|(Covid-based) Early release of super||Tax free|
|Child Care Transition Payment (paid to providers)||Assessable income, GST free supply|
|Creative Economy Support – grant||Assessable income, no GST|
|Creative Economy Support – concessional loan||Not assessable. Interest/deductions accounted for in the normal way|
|Consumer Travel Support grant||Assessable income, no GST|
|Vic & NSW Government business support grants||Non assessable non-exempt income (NANE), no GST|
|State Govt Voucher Subsidies||Assessable income, and GST accountable|
** Pandemic Leave Disaster Payments are assessable income but will NOT be included in the Centrelink payment summary, nor will it be prefilled in your income tax return. Tax return instructions are set out here.
Human Services Emergency Payments
The following payments are taxable:
- Disaster Recovery Allowance
- Disaster Recovery Allowance Top-up
- New Zealand Disaster Recovery Allowance
- Pandemic Leave Disaster Payment.
The following payments are not taxable:
- Australian Government Disaster Recovery Payment
- Australian Government Disaster Recovery Payment – Special Supplement for a natural disaster
- Australian Victim of Terrorism Overseas Payment
- COVID-19 Disaster Payment.
See further: Reporting disaster payments and grants in your tax return
See also at ato.gov.au: Government grants and payments during COVID-19
Redress Scheme Payments For NT & ACT Stolen Generations
Redress payments made to individuals under the Territories Stolen Generations Redress Scheme are exempt from tax and won’t affect eligibility for other Commonwealth payments and benefits. Legislation applies from 2021-22.
Disaster Relief Payments
Legislation has been passed to make disaster relief payments to individuals and businesses impacted by the devastating bushfires tax exempt.
- Disaster Recovery Allowance payments made to individuals; and
- Payments to small businesses and primary producers that would otherwise have been taxable
Most one-time and emergency disaster relief payments are exempt, or may become so after specific government action to declare them as such.
Some exempt payments however may still need to be declared, although non-taxable.
Payments to volunteer firefighters, assistance provided by charities and employers are exempt from tax.
For more information, see Disaster assistance payments and your tax
National Redress Scheme for Institutional Child Sexual Abuse
Taxation Determination TD 2018/16 – payments are not assessable or subject to capital gains tax. The determination applies from 1 July 2018.
Stolen Generation Compensation
Stolen Generation lump sums payments made by the various states and territories are not taxable income and do not need to be disclosed in a tax return. See here and further TR 95/35, CR 2016/86
Defence Force Overseas Projects
ADF personnel deployed overseas don’t pay income tax on the salary and allowances if there is a certificate in force issued by the Chief of the Defence Force in writing to the effect that you are on eligible duty with a specified organisation in a specified area outside Australia (not as, or under, an attaché at an Australian embassy or legation).
See Australian Defence Forces overseas service
Temporary residents generally don’t pay tax on their non-Australian income except income from employment or services.
Foreign tax paid on such income can generally be claimed as a foreign income tax offset.
See Foreign income exemption for temporary residents.
Because of the complexity of rules determining taxability of income, and potentially high penalties for getting things wrong, qualified advice is always recommended. Some items may be partially taxable.
For Tax Office guidance call 132861 or alternatively seek advice from a registered tax agent.
This page was last modified 2023-05-31