DCA 22 - TAX ON COMPENSATION PAYMENTS - DVA PENSIONS

DEFENCE COMPENSATION ADVICE - NO 22

Commonwealth Employees Rehabilitation And Compensation Act 1988

TAX ON COMPENSATION PAYMENTS - DVA PENSIONS

1.  I refer to our minute DM90-9174 of 15 June 1990 concerning the procedure to apply where a deduction of an overpayment of Repatriation Pension occurs (copy attached).

2.  As there was some concern that the instruction may have been incorrect, this Office sought further clarification from the Australian Taxation Office (ATO).

3.  ATO has now advised that our procedures are correct in that taxation instalment deductions should be made from the compensation payment after deducting the amount of DVA pension received during the period. I have enclosed a copy of their advice for your information.

4.  Should you have any further queries concerning this matter, please contact Mr Paul Ontong on 06-266 8639.

BRIEN ARMSTRONG

A/DRDDFC

   May 1990