Income Tax (Transitional Provisions) Act 1997

You must pay extra income tax (temporary budget repair levy) for a financial year if:

you are an individual; and

your taxable income for the corresponding income year exceeds $180,000; and

the financial year is a temporary budget repair levy year.

This section will also affect the income tax payable by some trustees who are taxed as if certain trust income were income of individuals. See sections 98 and 99 of the Income Tax Assessment Act 1936.

Your temporary budget repair levy is worked out by reference to your taxable income for the corresponding income year using the rate or rates that apply to you.

For the purpose of working out your income tax for the financial year:

section 4‑10 of the Income Tax Assessment Act 1997 has effect as if it made you liable to pay the extra tax mentioned in subsection (1) of this section; and

subsection 4‑10(3) of that Act has effect as if step 4 of the method statement in that subsection were omitted and the following were substituted:

To avoid doubt, temporary budget repair levy is not included in your basic income tax liability.

As a result, you cannot apply any tax offsets against temporary budget repair levy under Part 2‑20 of the Income Tax Assessment Act 1997 (apart from the foreign income tax offset applied under step 4 of the method statement in subsection (3)).

Each of the following is a temporary budget repair levy year:

the 2014‑15 financial year;

the 2015‑16 financial year;

the 2016‑17 financial year.