Commonwealth Consolidated Acts

TAXATION LAWS AMENDMENT ACT (NO. 2) 2000 - SCHEDULE 2

Income Tax Assessment Act 1936

1   After section   23G

Insert:

23GA   Interest on judgment debt relating to personal injury

  (1)   An amount derived during a year of income by way of interest on a judgment debt, whether payable under a law of the Commonwealth, a State or a Territory, or otherwise, is exempt from income tax if:

  (a)   the judgment debt arose from a judgment (the original judgment ) given by, or entered in, a court for an award of damages for personal injury; and

  (b)   the amount is in respect of the whole or any part of the period:

  (i)   beginning at the time of the original judgment, or, if the judgment debt is taken to have arisen at an earlier time, at that earlier time; and

  (ii)   ending when the original judgment is finalised.

  (2)   For the purposes of subsection   ( 1), an original judgment is finalised at whichever of the following times applies:

  (a)   if the period for lodging an appeal against either the original judgment or a subsequent related judgment ends without an appeal being lodged--the end of the period;

  (b)   if an appeal from either the original judgment or a subsequent related judgment is lodged and final judgment on the appeal is given by, or entered in, a court--when the final judgment takes effect;

  (c)   if an appeal from either the original judgment or a subsequent related judgment is lodged but is settled or discontinued--when the settlement or discontinuance takes effect.

  (3)   For the purposes of paragraph   ( 2)(b), a judgment is a final judgment if:

  (a)   no appeal lies against the judgment; or

  (b)   leave to appeal against the judgment has been refused.

Income Tax Assessment Act 1997

2   Section   11 - 10 (after table item headed "franchise fees windfall tax")

Insert:

3   At the end of Division   51

Add:

51 - 55   Interest on judgment debt relating to personal injury

  (1)   An amount paid by way of interest on a judgment debt, whether payable under a law of the Commonwealth, a State or Territory, or otherwise, is exempt from income tax if:

  (a)   the judgment debt arose from a judgment (the original judgment ) given by, or entered in, a court for an award of damages for personal injury; and

  (b)   the amount is in respect of the whole or any part of the period:

  (i)   beginning at the time of the original judgment, or, if the judgment debt is taken to have arisen at an earlier time, at that earlier time; and

  (ii)   ending when the original judgment is finalised.

  (2)   For the purposes of subsection   ( 1), an original judgment is finalised at whichever of the following times is applicable:

  (a)   if the period for lodging an appeal against either the original judgment or a subsequent related judgment ends without an appeal being lodged--the end of the period;

  (b)   if an appeal from either the original judgment or a subsequent related judgment is lodged and final judgment on the appeal is given by, or entered in, a court--when the final judgment takes effect;

  (c)   if an appeal from either the original judgment or a subsequent related judgment is lodged but is settled or discontinued--when the settlement or discontinuance takes effect.

  (3)   For the purposes of paragraph   ( 2)(b), a judgment is a final judgment if:

  (a)   no appeal lies against the judgment; or

  (b)   leave to appeal against the judgment has been refused.

4   Application

(1)   The amendment made by item   1 applies to the 1992 - 93 year of income and to later years of income up to, and including, the 1996 - 97 year of income.

(2)   The amendments made by items   2 and 3 apply to the 1997 - 98 year of income and later years of income.