Private ruling: Assessability of a government grant
Published: July 2012

Ruling: Q1: Is the government grant paid to the unit trust considered assessable income under section 6-5 of the Income Tax Assessment Act 1997 (ITAA 1997)? | A1: No. | Q2: Is the government grant paid to the unit trust considered assessable income under section 15-10 of the ITAA 1997? | A2: No. | Q3: Is the government grant paid to the unit trust considered assessable income under the capital gains tax provisions of the ITAA 1997? | A3: No. | Q4: Will the assessable recoupments provisions under Subdivision 20-A of the ITAA 1997 apply to include in your assessable income an amount equal to the deductions claimed under Division 40 of the ITAA 1997 in any particular year for depreciable items acquired with the government funding? | A4: Yes. | Q5: If the government grant paid to the unit trust is found to be assessable under questions 1, 2 or 3, is it considered a 'conditional grant' and assessable over the five year period designated under the conditions of the project? | A5: Not applicable. The timing of the receipt is irrelevant because the grant has been found to be not assessable under either section 6-5, section 15-10 or the CGT provisions in the ITAA 1997.




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