Private ruling: Foreign Income
Published: March 2013
Ruling period: Year ending 30 June 2013 | Year ending 30 June 2014 | Year ending 30 June 2015 | Year ending 30 June 2016
Date scheme commenced: 1 July 2012

Ruling: Question and answer | Is your foreign insurance premium taxable in Australia? | No.

Relevant facts and circumstances: You have an Australian Spouse Visa. You were not an Australian resident in 20YY. You received a life insurance payment from a Country X insurance company in 20YY. You intend to transfer the remaining cash from this payment into Australia when you move here permanently in the relevant year.

Relevant legislative provisions: Income Tax Assessment Act 1997 Subsection 6-5(2). | Income Tax Assessment Act 1997 Subsection 6-5(3).

Reasons for decision: Summary: Subsection 6-5(2) of the Income Tax Assessment Act 1997 (ITAA 1997) provides that the assessable income of a resident taxpayer includes ordinary income derived directly or indirectly from all sources during the income year. Subsection 6-5(3) of the Income Tax Assessment Act 1997 (ITAA 1997) provides that ordinary income derived by a non resident directly or indirectly from Australian sources, as well as other ordinary income included by a provision on a basis other than having an Australian source, is assessable. In your case, you received an insurance payment from a Country X insurance company in 20YY when you were not a resident of Australia for tax purposes. Therefore, this amount is not assessable in Australia. There are, no tax consequences associated with the transfer of capital from an overseas bank account to an Australian bank account.