Private ruling: Assessable income
Date of advice: 6 June 2022
Published: August 2022
Ruling period: Year ending 30 June 20XX
Date scheme commenced: XX September 2021

Ruling: Q1: Is the grant paid into your account by the Australian Council for the Arts (ACA) assessable to you under Income Tax Assessment Act 1997 (ITAA 1997) Section 15-10? | A1: No. The grant you received is not assessable to you, however, you may be subject to tax based on the amount you receive as personal income.

Relevant facts and circumstances: You are a sole trader working as a freelance designer/artist. Your not-for-profit group received a grant from the Australian Council for the Arts (ACA) under their "Arts Projects for Individuals and Groups" category. This grant was transferred into your personal business bank account. You do not have an entitlement to the grant personally. The full amount was then transferred into a different bank account made specifically for the group. You are not a signatory on the bank account, but 3 members of the group are. Each group member will receive a portion of the grant in their personal accounts which is paid out of the group account. The remaining amount will be used to pay for goods and services to complete the project.

Relevant legislative provisions: Income Tax Assessment Act 1997 (ITAA 1997) Section 15-10 Taxation Ruling 2006/3 (TR 2006/3) Income tax: government payments to industry to assist entities (including individuals) to continue, commence or cease business