Income Tax and Social Services Contribution Assessment Act 1965

Legislation au C1965A00033 Not in force Act

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Income Tax and Social Services Contribution Assessment

No. 33 of 1965

An Act relating to Income Tax.

[Assented to 2 June, 1965]

BE it enacted by the Queen’s Most Excellent Majesty, the Senate, and the House of Representatives of the Commonwealth of Australia, as follows:—

Short title and citation.

1.—(1.) This Act may be cited as the Income Tax and Social Services Contribution Assessment Act 1965.

(2.) The Income Tax and Social Services Contribution Assessment Act 1936-1964 is in this Act referred to as the Principal Act.

(3.) The Principal Act, as amended by this Act, may be cited as the Income Tax and Social Services Contribution Assessment Act 1936-1965.

Commencement.

2. This Act shall come into operation on the day on which it receives the Royal Assent.


Exemptions.

3. Section 23 of the Principal Act is amended—

(a) by inserting in paragraph (z), after the word “scholarship”, the words “(other than a scholarship referred to in the next succeeding paragraph)”;

(b) by omitting from paragraph (z) the word “and”; and

(c) by inserting after paragraph (z) the following paragraph:—

“(zaa) income derived by way of payments made to or in respect of a student under a scheme for the provision by the Commonwealth of secondary scholarships or technical scholarships; and”.

Gifts, calls on mining shares, pensions, &c.

4. Section 78 of the Principal Act is amended—

(a) by inserting in sub-paragraph (xxvi) of paragraph (a) or sub-section (1.), after the word “(Victoria),”, the words “the National Trust of Queensland,”; and

(b) by inserting after sub-paragraph (xli) of paragraph (a) of sub-section (1.) the following sub-paragraph:—

“(xlii) the Winston Churchill Memorial Trust,”.

5. Section 82j of the Principal Act is repealed and the following section inserted in its stead:—

Education expenses.

“82j.—(1.) Where, in the year of income—

(a) the taxpayer has paid education expenses in respect of a student; and

(b) no payment of any scholarship benefits (other than scholarship benefits payment of which was capable of being claimed in an earlier year of income) was capable of being claimed by any person in respect of that student,

the total amount of those expenses is an allowable deduction.

“(2.) Where, in the year of income—

(a) the taxpayer has paid education expenses in respect of a student; and

(b) payment of any scholarship benefits (other than scholarship benefits payment of which was capable of being claimed in an earlier year of income) was capable of being claimed by any person in respect of that student,

the amount, if any, by which the total amount of those expenses exceeds the total amount of those scholarship benefits is an allowable deduction.


“(3.) Where, in the year of income—

(a) each of two or more taxpayers has paid education expenses in respect of the one student; and

(b) payment of any scholarship benefits (other than scholarship benefits payment of which was capable of being claimed in an earlier year of income) was capable of being claimed by any person in respect of that student,

the last preceding sub-section does not apply but each of those taxpayers is entitled to a deduction of the amount, if any, by which the total amount of education expenses so paid by him exceeds such part of the total amount of those scholarship benefits as is reasonably related to the total amount of education expenses so paid by him.

“(4.) The deduction allowable under this section, in respect of any one year of income, in relation to the education of any one student shall not exceed One hundred and fifty pounds.

“(5.) Where, in respect of the year of income, two or more taxpayers would, but for this sub-section, be entitled to deductions under this section, amounting in the aggregate to more than One hundred and fifty pounds, for amounts paid by them in respect of the one student, those taxpayers shall be entitled, in respect of those amounts, to such deductions, amounting in the aggregate to One hundred and fifty pounds, as, in the opinion of the Commissioner, are reasonable in the circumstances.

“(6.) In this section—

‘education expenses’ means expenses necessarily incurred by the taxpayer for or in connexion with full-time education at a school, college or university or from a tutor;

‘scholarship benefits’ means amounts (other than amounts in the nature of an allowance for maintenance or accommodation) payable under a scheme for the provision by the Commonwealth of secondary scholarships or technical scholarships;

‘student’ means a person who is less than twenty-one years of age and—

(a) is a child of the taxpayer; or

(b) is a person in respect of whom the taxpayer is entitled to a deduction under section eighty-two b of this Act.”.


Constitution of Boards.

6. Section 251d of the Principal Act is amended by omitting from paragraph (a) of sub-section (1.) the words “Accountant at” and inserting in their stead the words “the officer in charge of”.

Application of amendments.

7. The amendments made by sections 3, 4 and 5 of this Act apply to assessments in respect of income of the year of income that commenced on the first day of July, One thousand nine hundred and sixty-four, and in respect of income of all subsequent years of income.

 

Overview

The Income Tax and Social Services Contribution Assessment Act 1965, enacted by the Parliament of Australia and receiving Royal Assent on 2 June 1965, was introduced to address certain amendments to income tax and social services contributions, aiming to provide clarity and adjustments to existing provisions. This Act modifies the Income Tax and Social Services Contribution Assessment Act 1936-1964, aiming to refine and update the tax system to better cater to contemporary needs and to ensure that the tax laws are fair and effectively administered. The policy objective of this Act is to streamline and clarify tax regulations, particularly concerning education expenses and scholarships, while also incorporating updates to entities eligible for certain tax exemptions and adjustments to the constitution of Boards.

Scope and Application

The Income Tax and Social Services Contribution Assessment Act 1965 applies to individuals, entities, and transactions involving income tax and social services contributions within the Commonwealth of Australia. The legislation amends the Principal Act, which is now referred to as the Income Tax and Social Services Contribution Assessment Act 1936-1965, to update and refine tax and social services contribution provisions. Specifically, it introduces amendments to sections relating to exemptions, gifts, calls on mining shares, pensions, and education expenses. These amendments apply to assessments of income for the year that commenced on 1 July 1964 and subsequent years. The Act also includes provisions for the constitution of Boards and allows for further application and refinement through subordinate instruments. Exemptions and specific provisions are detailed within the Act, including exclusions for certain scholarship incomes and allowances for education expenses paid for eligible students.

Key Provisions

The Income Tax and Social Services Contribution Assessment Act 1965 amends the Principal Act to include several key provisions that affect the taxation of certain types of income and the allowable deductions for education expenses. Section 3 amends the exemptions under section 23 to exclude certain scholarships from the definition of income, thus clarifying that payments made under specific Commonwealth scholarship schemes are not considered taxable income. Section 4 updates section 78 to include additional entities, such as the National Trust of Queensland and the Winston Churchill Memorial Trust, in the list of organisations whose gifts and pensions are exempt from income tax. The most significant change is introduced in section 5, which revises section 82j to allow taxpayers to claim deductions for education expenses paid for students under certain conditions. Specifically, section 82j(1) permits a deduction for education expenses paid if no scholarship benefits were claimed for that student. Section 82j(2) allows a deduction for the amount by which education expenses exceed any scholarship benefits claimed, while section 82j(3) provides rules for shared expenses among multiple taxpayers for the same student. The deduction is capped at £150 per student per year, and if the total exceeds this amount, the Commissioner of Taxation will determine a reasonable deduction. The Act imposes several obligations on taxpayers and educational institutions. Taxpayers must ensure that any payments made for a student's education are eligible for the deduction under section 82j. They must also keep accurate records of these expenses and any related scholarship benefits to substantiate their claims. Additionally, educational institutions must be aware of the new exemptions and ensure that any gifts or pensions they receive are correctly reported for tax purposes. The amendments also require the Commissioner of Taxation to determine reasonable deductions when multiple taxpayers claim expenses exceeding the £150 limit for the same student. All these obligations are designed to ensure compliance with the new provisions and to facilitate the correct application of tax laws. The Act does not explicitly outline criminal or civil penalties for non-compliance with its provisions. However, general tax legislation, such as the Income Tax Assessment Act 1997, includes penalties for non-compliance, including fines and imprisonment for wilful neglect or fraud. For instance, section 284 of the Income Tax Assessment Act 1997 imposes penalties for making a false or misleading statement in a tax document, which could include incorrect claims for education expense deductions. Additionally, section 286 imposes penalties for failing to lodge a tax return or providing false information in a return, which could apply if a taxpayer fails to report exempt income or incorrectly claims deductions. These penalties underscore the importance of accurate and honest reporting in compliance with tax laws.

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Sourced from the Federal Register of Legislation at 26 August 2026. For the latest information on Australian Government law please go to https://www.legislation.gov.au.