Commonwealth Consolidated Acts Commonwealth Consolidated Acts(1) The * tax free component of a * life benefit termination payment you receive is not assessable income and is not * exempt income.
(2) The * taxable component of the payment is assessable income.
(3) You are entitled to a * tax offset that ensures that the rate of income tax on the amount mentioned in subsection (4) does not exceed:
(a) if you are your * preservation age or older on the last day of the income year in which you receive the payment--15%; or
(b) otherwise--30%.
Note: The remainder of the taxable component is taxed at the top marginal rate in accordance with the Income Tax Rates Act 1986 .
(4) The amount is so much of the * taxable component of the payment as does not exceed the lesser of:
(a) the * ETP cap amount, reduced (but not below zero) by the amount worked out under this subsection for each * life benefit termination payment you have received earlier in the income year; and
(b) the ETP cap amount, reduced (but not below zero) by the amount worked out under this subsection for each life benefit termination payment you have received earlier in consequence of the same employment termination, whether in the income year or an earlier income year.
Note 1: For the ETP cap amount, see section 82-160.
Note 2: If you have also received a death benefit termination payment in the same income year, your entitlement to a tax offset under this section is not affected by your entitlement (if any) to a tax concession for the death benefit termination payment (under section 82- 65 or 82-70).
Note 3: Certain other life benefit termination payments made before 1 July 2012 may be treated as earlier payments under paragraph (4)(b): see section 82-10H of the Income Tax (Transitional Provisions) Act 1997 .
Guide to Subdivision 82-B