Private ruling: Assessable income and grants
Date of advice: 23 August 2024
Published: 30 September 2024
Ruling period: Year ended 30 June 20XX | Year ending 30 June 20XX
Date scheme commenced: 1 July 20XX

Ruling: Q1: Are the payments you are eligible for under the Victorian Government's Speech Pathology and Occupational Therapy Student Grant Program assessable income? | A1: No. The payments made under the program do not have the characteristics of ordinary income and therefore are not assessable under subsection 6-5(2) of the Income Tax Assessment Act 1997 (ITAA 1997). Also, successful applicants receive the grant in their capacity as 'workers being in regional Victoria' under which, and as a consequence of their satisfaction of all the eligibility criteria relating to the payment of the grant, and not because of any employment relationship they have or any services they will have rendered. As such, the grant that is paid is not assessable income under section 15-2 of the ITAA 1997. Consequently, the payments do not constitute assessable income.

Relevant facts and circumstances: You applied for a grant under the Victorian Government's Speech Pathology and Occupational Therapy Student Grant Program. The grants aim to grow the number of speech pathologists and occupational therapists working in regional and rural Victoria (including cross border communities), support recipients to move, settle and integrate into rural and regional communities and improve access to speech pathology and occupational therapists for those living in regional areas. The program seeks to achieve this aim by awarding grants to new graduates in speech pathology and occupational therapy who find employment in regional and rural Victoria. The grants comprise a maximum of $XXXX and are delivered in two instalments paid 6 months apart. The first instalment payment of $XXXX is to support costs associated with relocation and establishment in a regional and rural community. A second instalment payment of $XXXX will be made if the applicant is still employed in a regional or rural health setting at the time of the second payment. Your application to the Victorian Government's Speech Pathology and Occupational Therapy Student Grant Program was successful, and you were eligible for a grant. On XX/XX/20XX, you were notified via email that you would receive $XXXX for the first instalment of the grant and this would be paid in XX/20XX. You received the first grant instalment of $XXXX in XX/20XX. You were advised by the Victorian Government that you will need to apply for the second grant instalment of $XXXX in XX/20XX.

Relevant legislative provisions: Income Tax Assessment Act 1997 subsection 6-5(2) | Income Tax Assessment Act 1997 section 15-2