EXPLANATORY STATEMENT
STATUTORY RULE 1985 NO. 148
ISSUED BY THE AUTHORITY OF THE TREASURER INCOME TAX REGULATIONS (AMENDMENT)
This regulation preserves the long-standing income tax exemption of various allowances and a bounty paid to members of the Defence Force.
Sub-paragraph 23(t)(iii) of the Income Tax Assessment Act 1936 exempts from income tax payments of any allowance or bounty of a prescribed kind payable to or in respect of a member of the Defence Force. The payments exempted - separation, living out and education allowances and a re-engagement bounty - are those prescribed in regulation 4AAA of the Income Tax Regulations by reference to various regulations in the Defence Force (Salaries) Regulations, the Air Force Regulations, the Military Financial Regulations, the Naval Financial Regulations and the Defence Force (Bounties and Gratuities) Regulations’ under which these payments were previously made.
The Department of Defence recently completed transferring the prescription of certain financial conditions of service for Defence Force personnel, including the allowances and the bounty referred to above, from the Defence Force Regulations to Determinations made by the Minister for Defence under section 58B of the Defence Act 1903. The amendment to the Income Tax Regulations reflects the new authority for payment of the allowances and the bounty.
The amending regulation repeals the existing regulation 4AAA and substitutes a new regulation 4AAA which prescribes the allowances and the bounty that are exempt from income tax by reference to the Determinations made by the Minister for Defence authorising their payment. The relevant Determinations, their date of effect and the payments concerned are:
Determination | Date of Effect | Nature of Payment |
(a) Determination 0202 | 12 October 1982 | Separation allowance |
(b) Determination 0507 | 17 July 1984 | Living out allowance |
(c) Determination 0508 | 20 December 1984 | Living out away from home allowance |
(d) Determination 0501 | 23 October 1984 | Education allowance |
(e) Determination 0502 | 24 October 1984 | Scholarship allowance |
(f) Determination 3725 | 30 November 1984 | Education assistance overseas |
(g) Determination 3726 | 12 October 1984 | Child education allowance |
(h) Determination 0701 | 30 November 1984 | Re-engagement bounty. |
The exemption applies to payments of the allowances or bounty to members of the Defence Force made on or after the date the relevant Determination took effect.
Section 50 of the Acts Interpretation Act 1901 preserves the exemption of the allowances and the bounty extended during the life of the repealed regulation 4AAA. That section operates where a Commonwealth Act confers power to make regulations
so that, unless the contrary intention appears, the repeal of any regulation does not affect any right or privilege acquired under the regulation so repealed.