ATO has released details of a streamlined process to identify veterans affected by the Federal Court decision that Class A and B Invalidity Benefits from DFRDB and MSBS which commenced on or after 20 Sep 2007 may have been incorrectly taxed. ATO will require that the Commonwealth Superannuation Corporation (CSC) provide relevant data to the ATO in order to affect a streamlined “income tax remediation”.
This will be done in three phases, commencing with a pilot which will allow impacted individuals to come forward and seek income tax remediation. This will involve educational elements to ensure an understanding of potential adverse impacts of remediation. In most cases these amendments will result in a credit assessment, or no change to an individual’s assessment. However, depending on an individual’s circumstances there could be a debit outcome. Phases two and three are to address remaining individuals for income tax remediation.
The ATO also indicate that data will also be used for remediation of superannuation for impacted individuals. It is unclear what this means and DFWA is seeking further information.
Full details provided by the ATO here.
For more information read the main article Veteran Invalidity Benefit Taxation here.