Private ruling: Treatment of compensation payment
Date of advice: 16 May 2018
Published: August 2018

Ruling: Q1: Will any proceeds payable to The Company resulting from the litigation be assessable as ordinary income to The Trust under section 6-5 of the Income Tax Assessment Act 1997 (ITAA 1997)? | A1: No. Refer to Reasons for Decision. Any proceeds which may be payable from the litigation will be assessable as ordinary income to The Company | Q2: Will any proceeds payable to The Company resulting from the litigation be assessable as ordinary income to The Company under section 6-5 of the ITAA 1997? | A2: Yes | Q3: Will The Company be entitled to claim deductions under section 8-1 of the ITAA 1997 for legal and associated costs in respect of the litigation? | A3: No


Relevant legislative provisions: Income Tax Assessment Act 1997 Section 6-5 | Section 8-1


Subject: Treatment of compensation payment: In order to protect the privacy and commercial in-confidence components of this private binding ruling the following summary is provided. | The Commissioner has ruled on each of the specific questions.