Commonwealth Consolidated Acts

VETERANS' ENTITLEMENTS ACT 1986 - SECT 49Y

How to work out whether the sugarcane farmers' income test is satisfied

             (1)  This is how to work out whether a person who has transferred his or her eligible interest in a sugarcane farm or sugarcane farms satisfies the sugarcane farmers' income test for the purposes of this Division:

Person's ordinary income from all sources other than farming

             (2)  For the purpose of working out a person's ordinary income from all sources other than farming during a financial year, the following provisions have effect:

                     (a)  Divisions 1, 4, 6 and 7 of this Part apply to the person;

                     (b)  Division 2 of this Part applies to the person as if any reference in that Division to a tax year were a reference to that financial year;

                     (c)  Division 3 of this Part does not apply to the person;

                     (d)  any return on a financial asset that the person has actually received during the financial year is taken to be ordinary income of the person.

Person's ordinary income from farming

             (3)  For the purpose of working out a person's ordinary income from farming during a financial year, the following provisions have effect:

                     (a)  Divisions 1, 4, 6 and 7 of this Part apply to the person;

                     (b)  Division 2 of this Part applies to the person as if:

                              (i)  any reference in subsection 46B(1) to a tax year were a reference to that financial year; and

                             (ii)  subsection 46B(2) and section 46C were omitted;

                     (c)  Division 3 of this Part does not apply to the person;

                     (d)  any return on a financial asset that the person has actually received during the financial year and that relates to a farm or a relevant farm asset is taken to be ordinary income of the person from farming;

                     (e)  if, at the end of the financial year, the value of all trading stock on hand that relates to a farm is less than the value of all such trading stock on hand at the beginning of that financial year--the amount of the difference is to be deducted from that part of the person's ordinary income from farming for that financial year that is income in the form of profits;

                      (f)  there is also to be deducted from the person's ordinary income from farming:

                              (i)  losses and outgoings that relate to a business of primary production and are allowable deductions under section 8-1 of the Income Tax Assessment Act 1997 ; and

                             (ii)  deductions for the cost of depreciating assets that are used in a business of primary production and are allowable deductions under Subdivisions 40-A to 40-E (inclusive), or Division 328, of the Income Tax Assessment Act 1997 ; and

                            (iii)  contributions that are allowable deductions under section 290-60 of the Income Tax Assessment Act 1997 ;

                     (g)  if a negative result is obtained after applying paragraphs (e) and (f)--the person's ordinary income from farming for the financial year is a negative income;

                     (h)  if paragraph (g) does not apply--the person's ordinary income from farming for the financial year is a positive income.

Person's maximum basic rate for age service pension

             (4)  For the purposes of Step 4 in the Method statement in subsection (1), the maximum basic rate for age service pension applicable to the person is:

                     (a)  if the person was a member of a couple at any time during the 3 years immediately before the applicable completion day--the sum of:

                              (i)  an amount equal to twice the amount that was, on the applicable completion day, the maximum basic rate for a partnered person under point SCH6-B1; and

                             (ii)  an amount equal to twice the pension supplement under Module BA in Schedule 6; or

                     (b)  otherwise--the sum of:

                              (i)  the amount that was, on the applicable completion day, the maximum basic rate for a person who is not a member of a couple under point SCH6-B1; and

                             (ii)  the pension supplement under Module BA in Schedule 6.

Definitions

             (5)  In this section:

"applicable completion day" , in relation to a transfer, means the earlier of:

                     (a)  the day on which the transfer was completed; and

                     (b)  the RASF closing day.

"income" , in relation to a person, has the same meaning as in subsection 5H(1), except that, in addition to any amount that is not income of the person because of subsection 5H(4), (5) or (8), any payment to the person under:

                     (a)  the AUSTUDY scheme; or

                     (b)  the Social Security Act; or

                     (c)  the Farm Household Support Act 1992 ;

is not income of the person for the purposes of this section.

"ordinary income from farming" , in relation to a person who has an eligible interest in a sugarcane farm or sugarcane farms, means the ordinary income of the person from:

                     (a)  the sugarcane farm, or sugarcane farms, and any relevant sugarcane farm assets; and

                     (b)  any other farm, or farms, or relevant farm assets in which the person has an interest.