Document ID: chunk:federal_register_of_legislation:C2025C00014:section:23af:p5
Version: federal_register_of_legislation:C2025C00014
Segment Type: section
Provision Reference: s 23AF (pt 5/7)
Character Range: 113763–116330

(17) For the purposes of this section, income is excluded income if:
 (a) the income is income to which section 23AG applies; or
 (aa) the income is a payment, consideration or amount that:
 (i) is included in assessable income under Division 82, section 83‑295 or Division 301, 302, 304 or 305 of the Income Tax Assessment Act 1997; or
 (ii) is included in assessable income under Division 82 of the Income Tax (Transitional Provisions) Act 1997; or
 (iii) is mentioned in paragraph 82‑135(e), (f), (g), (i) or (j) of the Income Tax Assessment Act 1997; or
 (iv) is an amount transferred to a fund, if the amount is included in the assessable income of the fund under section 295‑200 of the Income Tax Assessment Act 1997; or
 (b) the income is derived from sources in a country other than Australia and:
 (i) is exempt from income tax in that country; and
 (ii) would not be exempt from income tax in that country apart from the operation of an agreement applying to Australia and that other country relating to the avoidance of double taxation or of a law of that other country giving effect to such an agreement; or
 (c) the income consists of:
 (i) payments in lieu of long service leave; or
 (ii) payments by way of superannuation or pension.
 (17A) If the income of a taxpayer of a year of income consists of an amount that is exempt from tax under this section (in this section called the exempt amount) and other income, the amount of tax (if any) payable in respect of the other income is calculated using the formula:

where:
Notional gross tax means the number of whole dollars in the amount of income tax that would be assessed under this Act in respect of the taxpayer's taxable income of the year of income if:
 (a) the exempt amount were not exempt income; and
 (aa) if the exempt amount is a payment covered by section 83‑240 or 305‑65 of the Income Tax Assessment Act 1997—the exempt amount (excluding any part of that amount that represented contributions made by the taxpayer) were assessable income of the taxpayer; and
 (b) the taxpayer were not entitled to any rebate of tax.
Notional gross taxable income means the number of whole dollars in the amount that would have been the taxpayer's taxable income of the year of income if the exempt amount were not exempt income.
Other taxable income means the amount (if any) remaining after deducting from so much of the other income as is assessable income:
 (d) any deductions allowable to the taxpayer in relation to the year of income that relate exclusively to that assessable income; and
 (e)