Private ruling: Foreign pension income
Date of advice: 12 January 2023
Published: 27 February 2023
Ruling period: Income Year ended 30 June 202X | Income Year ended 30 June 202X | Income Year ending 30 June 202X | Income Year ending 30 June 202X | Income Year ending 30 June 202X
Date scheme commenced: 1 July 202X

Ruling: Q1: Is the monthly disability compensation benefit you receive from XXX assessable in Australia? | A1: No. Article 19 of the tax treaty between Australia and XXX states that governmental salaries, wages and other similar remunerations including pensions paid from funds of one of the Contracting States, of a state or other political subdivision thereof or of an agency or authority of any of the foregoing for labor or personal services performed as an employee of any of the above in the discharge of governmental functions to a citizen of that State shall be exempt from tax by the other Contracting State. Your XXX pension is exempt income and not assessable in Australia under Article 19 of XXX as you are a citizen of XX.

Relevant facts and circumstances: You are a citizen of XXX. You are an Australian resident for income tax purposes. You sustained a service-connected injury while employed by XXX. You receive a monthly benefit from XXX for your service-connected disabilities. The benefit is not subject to tax in XXX. There is a tax treaty between Australia and XXX.

Relevant legislative provisions: Income Tax Assessment Act 1997 Subsection 6-5(2) | International Tax Agreements Act 1953