Private ruling: Assessable income
Date of advice: 23 April 2026
Published: 13 July 2026
Ruling period: Year ended 30 June 20YY
Date scheme commenced: 1 July 20YY

Ruling: Q1: Is the weekly amount received by you from your relative for living in your house assessable income? | A1: Yes.

Relevant facts and circumstances: You are the sole owner of the property. Your relative moved into the property and has resided there continuously since. Your relative pays you a weekly amount. Your relative and additional relative live at the property. There is a written rental agreement in place. The agreement allows your relative the use of the property and garage. The agreement states that your relative is required to pay for water and other utilities such as electricity and gas. Your relative makes weekly payments into your bank account. You have not increased the amount you charge your relative. Your relative claims the full amount of rent assistance. Your relative also requires the written rental agreement for Family Tax Benefit A & B. A number of years ago you moved back into the property and have resided there with your relative. You all have meals together from time to time and you each pay for your food separately. You have been treating the property as your main residence since moving back into it.

Relevant legislative provisions: Income Tax Assessment Act 1997 section 6-5

Reasons for decision: Summary: Section 6-5 of the Income Tax Assessment Act 1997 (ITAA 1997) provides that the assessable income of an Australian resident includes all ordinary income derived directly or indirectly from all sources. Rental income is normally regarded as ordinary income and therefore forms part of the taxpayer's assessable income. However, where there is a non-commercial or domestic arrangement, amounts paid for board or lodging do not give rise to the derivation of assessable income ( FC of T v. Groser 82 ATC 4478; 13 ATR 445). Taxation Ruling IT 2167 considers the consequences of different rental income producing situations. Paragraph 9 of IT 2167 states that: 9. A variety of arrangements may occur in situations of this nature. The rent payable may cover variable or running costs such as electricity, heating, etc. or the arrangements may require the tenant to pay, in addition to rent, a separate amount towards variable or running costs. The heading would also cover situations where board and lodging is provided. Paragraph 12 goes on to say: The approach to be followed in cases arising under this heading has been framed on the basis that the rent charged by the owner represents a normal commercial rent. The courts have identified a number of factors which indicate whether an amount is regarded as ordinary income. Characteristics of ordinary income that have evolved from case law include receipts that: • are earned, • are expected, • are relied upon, and • have an element of periodicity, recurrence or regularity. The money you receive from your relative to live in the property is rental income. Your relative is required to pay an amount per week to use the property and garage and pay for additional costs out of their pocket for water and electricity along with other living expenses such as food. Your relative declares this amount to Centrelink in order to obtain the full amount of rent assistance. You have a written agreement with your relative for the use of the property. The amount you receive is ordinary income as the payments are regular, relied upon and expected by you.