This is a compilation of the Income Tax Assessment Act 1936 that shows the text of the law as amended and in force on 1 January 2026 (the compilation date).
The notes at the end of this compilation (the endnotes) include information about amending laws and the amendment history of provisions of the compiled law.
Uncommenced amendments
The effect of uncommenced amendments is not shown in the text of the compiled law. The details of amendments made up to, but not commenced at, the compilation date are underlined in the endnotes. Any uncommenced amendments affecting the law are accessible on the Register (www.legislation.gov.au).
Application, saving and transitional provisions
If the operation of a provision or amendment of the compiled law is affected by an application, saving or transitional provision that is not included in this compilation, details are included in the endnotes.
Editorial changes
For more information about any editorial changes made in this compilation, see the endnotes.
Presentational changes
The Legislation Act 2003 provides for First Parliamentary Counsel to make presentational changes to a compilation. Presentational changes are applied to give a more consistent look and feel to legislation published on the Register, and enable the user to more easily navigate those documents.
Modifications
If the compiled law is modified by another law, the compiled law operates as modified but the modification does not amend the text of the law. Accordingly, this compilation does not show the text of the compiled law as modified. Any modifications affecting the law are accessible on the Register.
Self‑repealing provisions
If a provision of the compiled law has been repealed in accordance with a provision of the law, details are included in the endnotes.
6C Source of royalty income derived by a non‑resident
6CA Source of natural resource income derived by a non‑resident
6D Some tax offsets under the 1997 Assessment Act are treated as credits
6F Dual resident investment company
6H Recognised small credit unions, recognised medium credit unions and recognised large credit unions
7B Application of the Criminal Code
Part II—Administration
8 Commissioner
14 Annual report
Part III—Liability to taxation
Division 1—General
18 Accounting period
18A Accounting periods for VCLPs, ESVCLPs, AFOFs and VCMPs
21 Where consideration not in cash
21A Non‑cash business benefits
23AA Income of persons connected with certain projects of United States Government
23AB Income of certain persons serving with an armed force under the control of the United Nations
23AD Exemption of pay and allowances of Defence Force members performing certain overseas duty
23AF Exemption of certain income derived in respect of approved overseas projects
23AG Exemption of income earned in overseas employment
23AH Foreign branch income of Australian companies not assessable
23AI Amounts paid out of attributed income not assessable
23AK Amounts paid out of attributed foreign investment fund income not assessable
23B Reduction of disposal consideration if FIF attributed income not distributed
23G Exemption of interest received by credit unions
23K Substitution of certain securities
23L Certain benefits in the nature of income not assessable
Division 1AB—Certain State/Territory bodies exempt from income tax
Subdivision A—Exemption for certain State/Territory bodies
24AK Key principle
24AL Diagram—guide to work out if body is exempt under this Division
24AM Certain STBs exempt from tax
24AN Certain STBs not exempt from tax under this Division
24AO First way in which a body can be an STB
24AP Second way in which a body can be an STB
24AQ Third way in which a body can be an STB
24AR Fourth way in which a body can be an STB
24AS Fifth way in which a body can be an STB
24AT What do excluded STB, government entity and Territory mean?
24AU Governor, Minister and Department Head taken to be a government entity
24AV Regulations prescribing excluded STBs
Subdivision B—Body ceasing to be an STB
24AW Body ceasing to be an STB
24AX Special provisions relating to capital gains and losses
24AY Losses from STB years not carried forward
24AYA Effect of unfunded superannuation liabilities
24AZ Meaning of period and prescribed excluded STB
Division 2—Income
Subdivision A—Assessable income generally
25A Assessable income to include certain profits
26AB Assessable income—premium for lease
26AF Assessable income to include value of benefits received from or in connection with former paragraph 23(ja) funds or former section 23FB funds
26AFA Assessable income to include value of certain benefits received from or in connection with former section 23F funds
26AG Certain film proceeds included in assessable income
26AH Bonuses and other amounts received in respect of certain short‑term life assurance policies
26AJ Investment‑related lottery winnings to be included in assessable income
26BB Assessability of gain on disposal or redemption of traditional securities
26BC Securities lending arrangements
26E Income from RSAs
Subdivision AA—Non‑superannuation annuities etc.
27H Assessable income to include annuities and superannuation pensions
Subdivision D—Dividends
43A Subdivision has effect subject to provisions of Division 216 of the Income Tax Assessment Act 1997
43B Application of Subdivision to non‑share dividends
44 Dividends
45 Streaming of bonus shares and unfranked dividends
45A Streaming of dividends and capital benefits
45B Schemes to provide certain benefits
45BA Effect of determinations under section 45B for demerger benefits
45C Effect of determinations under sections 45A and 45B for capital benefits
45D Determinations under sections 45A, 45B and 45C
46FA Deduction for dividends on‑paid to non‑resident owner
46FB Unfranked non‑portfolio dividend account
47 Distributions by liquidator
47A Distribution benefits—CFCs
Division 3—Deductions
Subdivision A—General
51AAA Deductions not allowable in certain circumstances
51AD Deductions not allowable in respect of property used under certain leveraged arrangements
51AEA Meal entertainment—election under section 37AA of Fringe Benefits Tax Assessment Act 1986 to use 50/50 split method
51AEB Meal entertainment—election under section 37CA of Fringe Benefits Tax Assessment Act 1986 to use the 12 week register method
51AEC Entertainment facility—election under section 152B of Fringe Benefits Tax Assessment Act 1986 to use 50/50 split method
51AF Car expenses incurred by employee
51AGA No deduction to employee for certain car parking expenses
51AH Deductions not allowable where expenses incurred by employee are reimbursed
51AJ Deductions not allowable for private component of contributions for fringe benefits etc.
51AK Agreements for the provision of non‑deductible non‑cash business benefits
52 Loss on property acquired for profit‑making
52A Certain amounts disregarded in ascertaining taxable income
63 Bad debts
63D Bad debts etc. of money‑lenders not allowable deductions where attributable to listed country or unlisted country branches
63E Debt/equity swaps
63F Limit on deductions where debt write offs and debt/equity swaps occur
63G Bad debts etc. of trust not allowable in certain circumstances
65 Payments to associated persons and relatives
70B Deduction for loss on disposal or redemption of traditional securities
73A Expenditure on scientific research
73AA Section 73A roll‑over relief in the case of certain CGT roll‑overs
78A Certain gifts not to be allowable deductions
An Act to consolidate and amend the law relating to the imposition assessment and collection of a tax upon incomes
Part I—Preliminary
1 Short title
This Act may be cited as the Income Tax Assessment Act 1936.
6 Interpretation
(1AA) So far as a provision of the Income Tax Assessment Act 1936 gives an expression a particular meaning, the provision does not also have effect for the purposes of the Income Tax Assessment Act 1997 (the 1997 Act), or for the purposes of Schedule 1 to the Taxation Administration Act 1953, except as provided in the 1997 Act or in that Schedule.
(1) In this Act, unless the contrary intention appears:
100% subsidiary has the same meaning as in the Income Tax Assessment Act 1997.
adjusted fringe benefits total, of a taxpayer for a year of income, has the meaning given by clause 4 of Schedule 3 to the A New Tax System (Family Assistance) Act 1999.
adjusted taxable income for rebates means adjusted taxable income (within the meaning of the A New Tax System (Family Assistance) Act 1999, disregarding clauses 3 and 3A of Schedule 3 to that Act).
AFOF means an Australian venture capital fund of funds within the meaning of subsection 118‑410(3) of the Income Tax Assessment Act 1997.
agent: this Act applies to some entities (within the meaning of the Income Tax Assessment Act 1997) that are not agents in the same way as it applies to agents: see section 960‑105 of the Income Tax Assessment Act 1997.
allowable deduction has the same meaning as deduction has in the Income Tax Assessment Act 1997.
AMIT (short for attribution managed investment trust) has the same meaning as in the Income Tax Assessment Act 1997.
amount paid‑up on a share means the amount (if any), including any premium, paid on that share.
amount unpaid on a share means the amount (if any) unpaid on that share.
apportionable deductions has the meaning given by subsection 995‑1(1) of the Income Tax Assessment Act 1997.
approved form has the meaning given by section 388‑50 in Schedule 1 to the Taxation Administration Act 1953.
approved stock exchange has the same meaning as in the Income Tax Assessment Act 1997.
assessable income has the meaning given by subsection 995‑1(1) of the Income Tax Assessment Act 1997.
assessment means:
(a) the ascertainment:
(i) of the amount of taxable income (or that there is no taxable income); and
(ii) of the tax payable on that taxable income (or that no tax is payable); and
(iii) of the total of a taxpayer’s tax offset refunds for a year of income (or that the taxpayer can get no such refunds for the year of income); or
Note 1: A taxpayer does not have a taxable income if the taxpayer’s deductions equal or exceed the taxpayer’s assessable income: see subsection 4‑15(1) of the Income Tax Assessment Act 1997.
Note 2: A taxpayer may have no tax payable on an amount of taxable income if that income is below the tax‑free threshold or if the taxpayer’s tax offsets reduce the taxpayer’s basic income tax liability to nil.
(c) for a taxpayer that is the trustee of a unit trust that is a public trading trust (within the meaning of section 102R)—the ascertainment:
(i) of the net income of the trust (within the meaning of section 102M) (or that there is no net income); and
(ii) of the tax payable on that net income (or that no tax is payable); and
(iii) of the total of a taxpayer’s tax offset refunds for a year of income (or that the taxpayer can get no such refunds for the year of income); or
(d) for a taxpayer that is the trustee of a trust estate (other than a trustee to which paragraph (b) or (c) applies or the trustee of a complying superannuation fund, a non‑complying superannuation fund, a complying approved deposit fund, a non‑complying approved deposit fund or a pooled superannuation trust)—the ascertainment:
(i) of so much of the net income of the trust estate as is net income in respect of which the trustee is liable to pay tax (or that there is no net income in respect of which the trustee is so liable); and
(ii) of the tax payable on that net income (or that no tax is payable); and
(iii) of the total of a taxpayer’s tax offset refunds for a year of income (or that the taxpayer can get no such refunds for the year of income); or
(e) the ascertainment of the amount of interest payable under section 102AAM (about distributions from non‑resident trust estates); or
(h) the ascertainment of the amount of income tax payable on the no‑TFN contributions income as defined by section 295‑610 of the Income Tax Assessment Act 1997 (or that no tax is payable); or
(j) the ascertainment of the amount payable (or that no amount is payable) under the following:
(i) subsection 276‑105(2) of the Income Tax Assessment Act 1997 (AMIT trustee taxed on amounts attributed to foreign resident members);
(ii) subsection 276‑340(2) of that Act (AMIT trustee taxed on trust component deficit of character relating to tax offset);
(iii) subsection 276‑405(2) of that Act (AMIT trustee taxed on shortfall in determined member components of character relating to assessable income);
(iv) subsection 276‑410(2) of that Act (AMIT trustee taxed on excess in determined member components of character relating to tax offset);
(v) subsection 276‑415(2) of that Act (AMIT trustee taxed on amounts of determined trust component that are not reflected in member components);
(vi) subsection 276‑420(2) of that Act (AMIT trustee taxed on amounts of under of character relating to assessable income not properly carried forward);
(vii) subsection 276‑425(2) of that Act (AMIT trustee taxed on amounts of over of character relating to tax offset not properly carried forward); or
(k) the ascertainment of the amount payable under subsection 177P(1) (diverted profits tax).
attribution managed investment trust: see AMIT.
Australia has the same meaning as in the Income Tax Assessment Act 1997.
Australian superannuation fund has the meaning given by subsection 995‑1(1) of the Income Tax Assessment Act 1997.
bank or banker includes, but is not limited to, a body corporate that is an ADI (authorised deposit‑taking institution) for the purposes of the Banking Act 1959.
base interest rate has the meaning given by subsection 995‑1(1) of the Income Tax Assessment Act 1997.
basic income tax liability has the meaning given by section 4‑10 of the Income Tax Assessment Act 1997.
business has the meaning given by subsection 995‑1(1) of the Income Tax Assessment Act 1997.
capital gain has the same meaning as in the Income Tax Assessment Act 1997.
capital loss has the same meaning as in the Income Tax Assessment Act 1997.
capital proceeds has the same meaning as in the Income Tax Assessment Act 1997.
CGT asset has the same meaning as in the Income Tax Assessment Act 1997.
CGT event has the same meaning as in the Income Tax Assessment Act 1997.
Chief Executive Centrelink has the same meaning as in the Human Services (Centrelink) Act 1997.
child has the meaning given by subsection 995‑1(1) of the Income Tax Assessment Act 1997.
Commissioner means the Commissioner of Taxation.
Commonwealth education or training payment has the meaning given by subsection 995‑1(1) of the Income Tax Assessment Act 1997.
company has the meaning given by subsection 995‑1(1) of the Income Tax Assessment Act 1997.
complying approved deposit fund has the meaning given by subsection 995‑1(1) of the Income Tax Assessment Act 1997.
complying superannuation fund has the meaning given by subsection 995‑1(1) of the Income Tax Assessment Act 1997.
consolidated group has the same meaning as in the Income Tax Assessment Act 1997.
constituent document, in relation to a company, means the memorandum and articles of association of the company, or any rules or other document constituting the company or governing its activities.
corporate limited partnership has the meaning given by section 94D.
corporate tax entity has the same meaning as in the Income Tax Assessment Act 1997.
corporate tax rate has the same meaning as in the Income Tax Assessment Act 1997.
cost base of a CGT asset has the same meaning as in the Income Tax Assessment Act 1997.
creditable acquisition has the meaning given by section 195‑1 of the GST Act.
debenture, in relation to a company, includes debenture stock, bonds, notes and any other securities of the company, whether constituting a charge on the assets of the company or not.
debt interest has the same meaning as in the Income Tax Assessment Act 1997.
deductible gift recipient has the meaning given by the Income Tax Assessment Act 1997.
demerged entity has the meaning given by section 125‑70 of the Income Tax Assessment Act 1997.
demerger has the meaning given by section 125‑70 of the Income Tax Assessment Act 1997.
demerger allocation means:
(a) the total market value of the allocation represented by the ownership interests issued by the demerged entity in itself under a demerger to the owners of ownership interests in the head entity of the demerger group; or
(b) the total market value of the allocation represented by the ownership interests disposed of by a member of a demerger group under a demerger to the owners of ownership interests in the head entity; or
(c) the total of both of those market values.
demerger dividend means that part of a demerger allocation that is assessable as a dividend under subsection 44(1) or that would be so assessable apart from subsections 44(3) and (4).
demerger group has the meaning given by section 125‑65 of the Income Tax Assessment Act 1997.
demerger subsidiary has the meaning given by section 125‑65 of the Income Tax Assessment Act 1997.