Private ruling: Rental income
Date of advice: 8 September 2023
Published: 24 October 2023
Ruling period: Year ended 30 June 2023
Date scheme commenced: 1 July 2022

Ruling: Q1: Is the weekly income you receive from your child for renting your unit assessable income? | A1: No. Based on the information provided to the Commissioner the money you and your spouse receive from your child as rent for your unit is not assessable under 6-5 of the Income Tax Assessment Act 1997 (ITAA 1997). The arrangement you have with your child is not a commercial arrangement and is a family arrangement. You do not need to declare these amounts in your tax return and you are not able to claim any deductions in relation to the unit you rent to your child.

Relevant facts and circumstances: You and your spouse purchased a unit a couple of years ago. The unit is held 50-50 with you and your spouse. You and your spouse purchased the unit for your child to live in it. The idea was to assist your child in living independently. Your child receives a pension. You and your spouse charge your child weekly rent. The rent covers the cost of having the unit and maintenance. You have received land tax exemption. You and your spouse intention was not to make money out of having the unit but to assist your child with supporting their disability.

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