Income

This tab includes all income and supplementary income items.

Items in the income tab:

Item 1-Salary, Wages, Commissions, Bonuses etc

Item 2 Label K-Allowances, earnings, tips, director's fees, etc

Item 3 Labels R and H-Lump Sum Payments

Item 4 Label E-Employment Termination Payments

Item 5 Label A-Australian Government allowances and payments

Item 6 Label B-Australian Government pensions and allowances

Item 7-Australian annuities and superannuation income streams  

Item 8-Australian superannuation lump sum payments 

Item 9-Attributed personal services income  

Item 10-Gross interest income

Item 11-Dividend Income

Item 12-Employee share schemes  and

Supplementary Income Items 13 - 24

Back to Individual Return

Item 1-Salary, Wages, Commissions, Bonuses etc

Click this link for Item 1 Income on Individual tax return instructions 2017 on the ATO website.

Click this link for information on the Seasonal Worker Programme.

The Seasonal Worker Programme assists Australian employers in the agriculture sector nation-wide, accommodation sector (in selected locations) and tourism sector (the Northern Australia tourism pilot) that are unable to find enough local Australian labour by providing access to workers from Pacific island countries and Timor-Leste. Seasonal workers can return in following seasons, providing employers with access to a reliable, returning workforce.

The programme contributes to the economic development of eligible Pacific island countries and Timor-Leste by providing access to low and unskilled work opportunities in Australia.

Item 1

This is a calculator-only field provided for the correct calculation of tax on taxable income at special rates.

Select Yes if the taxpayer is a Seasonal Worker under this programme.

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Working Holiday Makers

Read the on-screen text and select Yes at the 416 or 462 working holiday visa question, so that tax is calculated at 15% on WHM income earned on or after 1 January 2017 on the first $37,000 WHM net income.

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If your payment summary includes Gross payment type H, print H in the payment type box. Gross payment type H applies to you if you were on a 417 or 462 working holiday visa and you earned income at any time from 1 January to 30 June 2017. If this applies to you, then you must complete item A4.

Note if your working holiday maker has a foreign payment summary with code H, select the code G and include any include WHM income and expenses incurred in earning that income on or after 1 January 2017 at item A4. This code will be converted to H for electronic lodgment.

For MYOB Tax to provide a correct calculation of tax payable, if you select Code F (Foreign) at item 1, then you must select Yes or No at the checkbox provided for the Seasonal Workers Programme.

Amounts should only be entered at item 1 if the taxpayer has a Payment Summary from an employer, or has signed a Statutory Declaration that the payment summary is lost or was not received.

At item 1 there are two sets of payment summary fields in the return. If you have more than two payment summaries, enter these in the Excess Payment Summary worksheet (egc).

You should also enter at item 1:

• Allowances, earnings, tips, director's fees, etc, as they are recorded on each Payment Summary and these amounts will integrate to Item 2 label K.

• Employer lump sum amounts A and B, as they are recorded on each Payment Summary and these amounts will integrate to item 3 labels R and H. Key the gross amount for Lump Sum "B" and Tax automatically calculates the 5% assessable amount and integrates it at Item 3 Label H.

If the taxpayer has more than 2 Payment Summaries press [Enter] at the Additional Payment Summaries box and complete a separate PAYG Payment Summary (egc) for each. The sum of these amounts will be shown as a single entry at Label G.

Reportable Fringe Benefits and Reportable Superannuation contributions

In MYOB Tax, you will also enter Reportable Fringe Benefits and Reportable Superannuation contributions that are notified on the PAYG Payment Summary. These amounts are passed to the Income Test Items IT1 and IT2 respectively.

From 1 July 2016, Reportable fringe benefits are reported separately in accordance with their exemption status under section 57A of the FBTAA 1986. Please enter this amount at the correct field as defined on the Payment Summary.

If you received any reportable fringe benefits amounts of $3,921 or more, enter those amounts at the relevant field(s) in the Reportable fringe benefits box. Do not enter amounts that are less than $3,921 as this will affect the calculation of the Adjusted taxable income (ATI) that is used for defining eligibility for some offsets, for example dependency offsets and SAPTO.

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Payment Summary Information

Click this link for information on PAYG payment summaries - individual non-business on the ATO website.

Foreign Employment Payment Summaries

If you are entering the details of a Foreign Employment summary, select Code F from the drop down at the gross income label.

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If a working holiday maker receives a foreign payment summary while working in Australia and holding a 416 or 462 visa, select Code G from the drop down at the gross income label. Note that Code G will be converted to Code H for electronic lodgment purposes, ensuring that the ATO is alerted to the special income and will calculate tax in accordance with the legislated 15% up to $37,000 tax rate and threshold.

Such amounts must also be included in an information label at item 20 label U Net foreign employment income - payment summary and Tax will transfer any amount with the code F to a special holding dialog at item 20 label U. This dialog also contains a field to enter any applicable work related expense that has been claimed at items D1 to D5. If foreign tax has been paid on this income, there may be an entitlement to a foreign tax credit.

Foreign Income Tax Offset (FITO)

For the correct calculation of FITO, instructional text has been added at item 1 to alert those preparers entering foreign payment summaries and selecting the code F not to enter the foreign tax paid on that income at item 1 but to enter it in the dialog provided behind label U at item 20.

The Income amount is automatically transferred to this dialog; however, you will need to enter the amount of foreign tax in the field provided as shown in the following image.

Late, lost or wrong payment summaries, letter or signed statements from your payer (employer)

See Lost or missing PAYG withholding payment summary on the ATO website for more information.

Occupation Code

If you enter amounts for salary or wages, an occupation code, representing the main occupation must be provided. If you are unsure then select the occupation code that represents the highest earnings. The full list of codes recognised by the ATO is provided as an [F10] list. A search function is provided and keying one or more words of the job description in this and clicking the Search button will provide a list of all Occupations containing the words.

Paid Parental Leave (PPL)

When paid by your employer, PPL will be included in gross payments and not listed separately like, bonuses, etc.

PPL will be listed separately only if it comes from the Family Assistance Office (FAO) in which case you will have a PAYG Payment Summary issued by Centrelink. These Centrelink payments must be entered at item 1 as salary and wages and not at item 5 as such payments do not lead to a beneficiary offset.

Salary or Wages

Payer's ABN and (optional) Name: If an ABN is entered it must pass the ATO algorithm for valid ABNs or WPNs. If an ABN is present, then an occupation code and description must be present. The Payer's name may be provided but this is not mandatory.

Tax Withheld: For each employer (payer), enter the amount of tax withheld from the relevant Payment Summary - Individual, non-business. The amount of tax withheld may not exceed the gross payment.

Gross payment: For each employer (payer), enter the gross payment amount from the relevant Payment Summary - Individual, non-business. If a gross salary amount greater than zero is entered, then an occupation code and description must be present.

Amounts marked 'A' and Amounts marked 'B': The total of amounts entered in these fields are shown at Item 3 Lump Sum Payments.

Further Information

Lump sum payments that you show at item 3 are amounts paid for unused annual leave or unused long service leave. If you have received such a lump sum payment it will appear at either 'Lump sum A' or 'Lump sum B' on the payment summary or statement you received.

Lump sum A

The amount shown at 'Lump sum A' was paid to you:

• for unused long service leave, or unused annual leave, that accrued after 17 August 1993 if that amount related to a payment that was made in connection with a genuine redundancy payment, an early retirement scheme payment or the invalidity segment of an employment termination payment or a superannuation benefit;

• for unused long service leave that accrued after 15 August 1978 and before 18 August 1993, or

• for unused annual leave that accrued before 18 August 1993.

Lump sum B

The amount at 'Lump sum B' was paid to you for unused long service leave which you accumulated before 16 August 1978.

Type Code

If the amount shown at 'Lump sum A' related to a payment that was made as a genuine redundancy payment, an early retirement scheme payment, or the invalidity segment of an employment termination payment or a superannuation benefit enter R in the Type column. Check with your payer if you are not sure.

Otherwise enter T in the Type column

Excess Employer PAYG Payment Summaries

If the taxpayer has more than 2 Payment Summaries press [Enter] at the Additional Payment Summaries box and complete a separate PAYG Payment Summary (egc) for each. The sum of these amounts will be shown as a single entry at Label G.

When the return is printed as a facsimile, the Excess PAYG Payment Summary entries that exceed the four sets of labels on the pre-printed return are printed on an Additional Information schedule in accordance with ATO instructions. If 'Print details in return' has been selected as a print default for the Client Copy print-out, all entries are printed at Item 1. When the Print details in return has not been selected as the default, the excess entries are printed on a schedule headed 'Excess Payment Summaries'.

Related Topics

Item 2 Label K-Allowances, earnings, tips, director's fees, etc

Item 3 Labels R and H-Lump Sum Payments

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CCH References

10-030 Convertibility into money

10-050 Direct compensation for services

14-700 Genuine redundancy payments

26-150 Payments for work or services

26-120 Payments from which amounts must be withheld

Item 2 Label K-Allowances, earnings, tips, director's fees, etc

Click this link for Item 2 Income on Individual tax return instructions 2017 on the ATO website.

Allowances, earnings, tips, director's fees etc. are entered at Item 1

Reasonable travel allowances and overtime meal allowances not shown on a payment summary

For information on reasonable travel and overtime meal allowances search the ATO website for the Tax Determination TD 2016/17.

If the taxpayer has received such an allowance and it is not shown on the payment summary, it does not have to be included as income at this item providing all the allowance was spent on deductible expenses and you are not making a claim for expenses relating to the allowance at D2 or D5.

Deductions

A deduction cannot automatically be claimed just because the taxpayer received an allowance. Click these links Item D2 and Item D5 on the ATO website for advice as to what is able to be deducted.

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CCH References

10-030 Convertibility into money

10-050 Direct compensation for services

10-060 Allowances and Fringe Benefits

26-120 Payments from which amounts must be withheld

26-150 Payments for work or services

Item 3 Labels R and H-Lump Sum Payments

Amounts to be entered for item 3 are shown on the Payment Summary (PS) as labels A and B and comprise lump sum payments from an employer for unused annual leave or unused long service leave.

In Tax these lumps sum payments amounts are entered at Item 1.

Click this link for Item 3 Lump Sum Payments on the ATO website.

Lump Sum A: Enter any amount of tax withheld for Lump Sum A payments in the Tax withheld column.

Lump Sum A code: For each lump sum A amount, the ATO requires a defining code. Select the appropriate code from the list:

• R - genuine redundancy, invalidity segment of an employment termination payment or superannuation benefit or under an early retirement scheme

• T - any other reason.

Lump Sum B: The amount at B was paid for unused long service leave that accumulated before 16 August 1978. Only five percent (5%) of this amount is taxable. Enter the full amount of the payment and Tax will calculate 5% and include the amount at label H

Enter any amount of tax withheld from Lump Sum B payments in the Tax withheld column.

Payment Summary 

Other lump sums for early retirement scheme payments and redundancy payments, shown as Lump sum D on the Payment Summary if applicable will have been included in an Employment Termination Payment (ETP) and if not part of an ETP should not be included at any item in the tax return.

Lump sum payments in arrears shown as Lump sum E on the Payment Summary must be entered at item 24 Other Income.

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CCH References

10-030 Convertibility into money

10-050 Direct compensation for services

14-700 Genuine redundancy payments

26-120 Payments from which amounts must be withheld

26-150 Payments for work or services

Item 4 Label E-Employment Termination Payments

This item is supported by the ELS Employment Termination Payment schedule PY. A separate PY must be completed for each ETP PAYG payment summary received. Press [Enter] at any of the fields at item 4, to open this worksheet. Refer to Employment termination payment for individuals schedule (PY) for a description of the fields and when the ELS schedule will be lodged with the return.

Click this link for Item 4 Employment Termination Payments on the ATO website.

Click the relevant link on the Special circumstances and glossary page on the ATO website for more information.

If the taxpayer was to have received an ETP and did not receive a PAYG payment summary-employment termination payment, or if the taxpayer has lost it and the employer has not replaced it, the taxpayer will be required to complete a Statutory Declaration (NAT 4135).

Employment termination payment for individuals schedule (PY)

To complete item 4 use the schedule PY. The PY is a multiple worksheet which must be completed to conform to ELS requirements for lodging that schedule.

This schedule can be pre-filled. Note that Tax offset (T2) must be entered manually. For more information about pre-filling a tax return, see Pre-fill Manager.

Number of ETP schedules completed:

• Where only 1 ETP schedule is completed, the relevant details default to the labels in the main return and the PY will NOT be transmitted to the ATO via ELS/PLS.

• Where there is more than 1 ETP schedule completed, on integration an 'M' for multiple will be integrated to the code box at item 4, and the sum of Taxable component will integrate to label I and all instances of PY will be lodged via ELS/PLS.

Payment Details

Enter the Payment details as disclosed on the ETP Payment Summary:

• Date of payment

• Total tax withheld amount

• Total taxable component

• Payment type

• Payer's ABN

On integration to the main return, Tax applies the code accordingly.

Only the Taxable component of an ETP is included as income in the Tax Return. The other fields are required to correctly calculate any ETP offset due and to collect amounts over the cap that are to be taxed at top marginal rates.

Tax-free components are non-assessable, non-exempt income and are NOT to be included at any item in the return.

Click this link for information on the ATO website describing Employment termination payments.

Tax Offset

The taxpayer's age is relevant in calculating any tax offsets for which he or she may be eligible. Where applicable Tax will calculate the amount of tax offset to ensure that the taxpayer pays no more tax than required.

Taxpayer DOB is missing

If the Taxpayer DOB is missing, MYOB Tax now calculates the ETP on the basis of the taxpayer being under 55 years. This safeguards the taxpayer by understating the offset where this condition exists.

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CCH References

14-000 Taxation of superannuation and termination payments

14-600 Employment termination payments - overview

14-610 What is an employment termination payment

14-620 Taxation of life benefit termination payments

14-630 Pre-July 83 segment

14-640 Invalidity segment

14-600 Directed termination payments

14-680 Death benefit termination payments

14-700 Genuine redundancy payments

14-710 Early retirement scheme payments

14-720 Unused annual leave payments

14-730 Unused long service leave payments

14-740 Foreign termination payments

14-600 Transitional termination payments

Item 5 Label A-Australian Government allowances and payments

Click this link to open the Item 5 - Australian Government allowances and payments on the ATO website.

Click this link for the Exempt income information on the ATO website.

Do not include any Paid Parental Leave Payments (PPL) at this item; enter them at item 1 Salary and wages.

You can use the Pre-fill from the Tax Agent's Portal to complete this item. The worksheet (aga) at label A will retain the imported pre-fill information or you can enter details of the pension for record keeping purposes. Refer to Australian Government allowances and payments worksheet (aga).

Tax Withheld: Any amount of tax withheld cannot exceed the total amount of benefits received.

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CCH References

10-190 Social security, etc pensions

15-315 Recipients of social security benefits and allowances

Item 6 Label B-Australian Government pensions and allowances

Click this link to open the Item 6 - Australian Government pensions and allowances on the ATO website.

You can use the Pre-fill from the Tax Agent's Portal to complete this item. The worksheet (agp) at label B will retain the imported pre-fill information or you can enter details of the pension for record keeping purposes. Refer to Australian Government Pensions and Allowances worksheet (agp).

SAPTO worksheet

Complete the SAPTO worksheet which is accessed from Item 6 or T1. Tax will default any relevant information already entered elsewhere in the return, such as dates of birth. For details on this worksheet refer to Senior Australian and Pensioner Worksheet (SAPTO).

ONLY include Australian Government pensions. Other pensions are reported elsewhere in the return. For example:

• Australian annuities and superannuation income streams (Item 7).

• Overseas Pensions (Item 20).

• Details of the spouse's pension shown at Spouse Details (Item SD label P).

• Exempt pensions received by the spouse (Item SD label B).

Related Topics

Spouse Details Item SD

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CCH References

10-190 Social security, etc pensions

15-315 Recipients of Social Security Benefits and Allowances

Item 7-Australian annuities and superannuation income streams

Click this link for information on Item 7-Australian annuities and superannuation income streams on the ATO website.

The taxable component of such payments is detailed on the Payment Summary received from the Superannuation Fund as 'Taxed and/or Untaxed elements'. These amounts, together with the Assessable amount of Non-Superannuation Annuities are entered at labels J and N.

Lump sum in arrears taxable components are detailed on the Payment Summary received from the Superannuation Fund as 'Taxed and/or Untaxed elements'. These amounts are entered at labels Y and Z.

Tax-free components are non-assessable, non-exempt income and are NOT to be included at any item in the return.

Use the Australian annuities and superannuation income streams worksheet (asi) to calculate the income amounts to be disclosed at these labels and if the Tax Offset has not been included on the Payment Summary, use the Superannuation income streams to calculate any offset that can be claimed at item T3. Refer to Annuities and superannuation income streams worksheet (asi).

Ensure that you complete the worksheet at item T3 if the taxpayer is entitled to claim any Australian superannuation income stream offset. Refer to Annuity and Super Income Stream Offset (pen).

Alternatively, if the taxpayer received any income from an Australian annuity or superannuation income stream, enter those details at this item.

Total tax withheld: this is the total of amounts of tax withheld as detailed in the PAYG payment summary-superannuation income stream plus amounts of tax withheld from Australian non-superannuation annuities detailed in the PAYG payment summary-individual non-business.

Taxable component Taxed element, Label J: This is the sum of all the taxed element amounts of Australian superannuation income streams and must only contain amounts that were paid before the taxpayer turned 60 years of age.

Taxable component Untaxed element, label N: This is the sum of all the untaxed elements of Australian superannuation income streams, whether the taxpayer has reached the age of 60 years or not, plus the assessable amounts of Australian non-superannuation annuities.

Lump sum in arrears - Taxable component - Taxed element, Label Y: Enter the amount of the taxed element.

Lump sum in arrears - Taxable component - Untaxed element, Label Z: Enter the amount of the untaxed element.

Click this link for information on the ATO website non-assessable non-exempt income.

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CCH References

14-510 Annuities and foreign fund pensions

Item 8-Australian superannuation lump sum payments

This item is supported by the ELS Australian Superannuation lump sum payments schedule (PL). Press [Enter] at any of the fields at item 8, to open this worksheet.

A schedule PL should be completed for each Payment Summary received from the Superannuation Fund. The PL will only be transmitted to the ATO via ELS/PLS if the taxpayer has received more than one Payment Summary concerning Australian Superannuation lump sum payments.

Click this link for information on Item 8-Australian superannuation lump sum payments on the ATO website.

Superannuation lump sum schedule (PL)

The Superannuation lump sum schedule (PL) is a multiple worksheet. It must be completed to conform to ELS requirements for lodging that schedule and so that the Tax program can collect the information necessary to calculate the correct offset (MYOB tax collects some information that the ATO has no need to collect as it is sent to the Government separately by the Fund). Refer to Superannuation lump sum schedule (PL).

Where there is only 1 PAYG payment summary completed, the relevant details will be defaulted to the labels in the main return and the PY will NOT be transmitted to the ATO via ELS/PLS.

Where there is more than 1 ETP schedule completed, on integration an 'M' for multiple will be integrated to the code box at item 4, and the sum of Taxable component will integrate to label I and all instances of PY will be lodged via ELS/PLS.

Payment Details

Enter the Payment details as disclosed on the PAYG Payment Summary-Australian superannuation lump sum.

The fields are described below in the order they appear in the return:

• Tax withheld

• Type

• Date of payment

• Total tax withheld amount

• Total taxable component - Taxed element

• Payer's ABN

• Total Taxable component - Untaxed element

Tax Offset on superannuation lump sums

The taxpayer may be entitled to a tax offset to ensure that certain elements of the superannuation lump sum are only taxed up to a maximum concessional rate of tax. Tax will calculate any offset available and include it in the Estimate.

To confirm the rates for the year, select:

• Maintenance > Tax Rates > Calculator Tables > Master Individual table > Properties > Resident > ETP Super Lump Sum Offsets and select the Super Lump Sum tab.

• Maintenance > Tax Rates > Calculator Tables > Master Individual table > Properties > Resident > ETP Super Lump Sum Offsets and select the Super Death Benefits tab.

Click this link to the ATO website for the Special circumstances and glossary information.

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CCH References

14-120 Superannuation lump sums and income streams

14-220 Taxation of benefits from a taxed source

14-240 Taxation of benefits from an untaxed source

14-270 Superannuation death benefits

14-280 Taxation of superannuation death benefits

Item 9-Attributed personal services income

Click this link for the Item 9 - Attributed personal services income information on the ATO website.

Gross Payment

This is the total amount attributed from personal services entities detailed on the Payment Summary provided by the entity. Gross amounts will be integrated to label O.

You cannot enter information directly at label L. To open the Payment Summary schedule press [Enter] at label L or select Preparation > Schedule > ps Payment Summary schedule. Refer to Payment summary schedule (PS). Attributed Personal Services Income integrates from the Payment Summary Schedule PS where the payment type is A.

Tax Withheld

This is the total amount withheld from the payment and cannot be more than 50% of the gross amount.

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CCH References

30-600 Summary of PSI regime

Item 10-Gross interest income

Click this link for the Item 10 Gross interest income information on the ATO website.

ALERT!

Do NOT include at this item or anywhere else in the tax return any interest earned on a First Home Saver Account. The taxpayer does not have to pay tax on this FHSA interest it is non-assessable non-exempt and therefore tax-free.

Use the Interest income worksheet (int) to record the individual transactions and then share some or all of them with a joint account holder. These transactions may be entered in dollars and cents. Tax will total the entries and round them on integration to label L and at the same time integrate any TFN withheld amount to label M. Refer to Interest income worksheet (int).

From the Interest Income worksheet (int) there is a Quick access point to the Interest deductions worksheet (idd).

Alternatively, you may use the Pre-fill report from the Tax Agent's Portal to complete this item. Doing so will avoid the necessity to share this income with another taxpayer as the Pre-fill report contains only the taxpayer's share of that income.

Deductions relating to interest income should be entered at D7 and if they exceed $4,999 should be entered in the ELS Interest and Dividend Schedule (BJ) and lodged with the return.

Label L-Gross Interest

This is the total amount of gross interest received by the taxpayer from Australian sources, such as a bank, credit union, building society, government securities, debentures, notes and deposits or children's accounts, the ATO (early payment interest credit) or any other source in Australia. If the taxpayer had a joint account and quoted a TFN, show their share of the interest here.

For information on the ATO website about non-residents withholding tax click this link Special circumstances and glossary.

Label M-TFN amounts withheld from gross interest

This is the total amount of tax withheld for failure to quote a TFN. If the Interest income worksheet (int) is not used, key the amount to be included in assessable income. Show only the taxpayer's share of jointly held interest bearing accounts. The total amount of tax withheld cannot be more than 50% of the total interest amount.

Related Topics

Interest Deductions worksheet (idd)

Interest and Dividend Deductions (BJ)

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CCH References

10-470 Interest

Item 11-Dividend Income

Click this link for Item 11 - Dividend Income information on the ATO website.

This item is about dividends and distributions that were paid or credited to you by Australian companies that you had shares in.

Use the Gross Dividend worksheet (div) to record the individual transactions and then share some or all of them with a co-owner. These transactions may be entered in dollars and cents. Tax will total the entries and round them on integration to the relevant labels - Unfranked amount, Franked amount, Franking credit and TFN amounts withheld from dividends. Refer to Gross dividends worksheet (div).

From the Gross dividends worksheet (div) the Dividends deductions worksheet (ddd) can be opened.

Alternatively, you may use the Pre-fill report from the Tax Agent's Portal to complete this item. Doing so will avoid the necessity to share this income with another taxpayer as the Pre-fill report contains only the particular taxpayer's share of that income.

Click this link for Special circumstances and glossary information on Non-resident withholding tax on the ATO website.

Deductions relating to Dividend income must be entered at item D8 and if they are in excess of $4,999 the ELS Interest and Dividend Deductions Schedule (BJ) must be completed and lodged with the return.

Label S - Unfranked amount

This is the total of amounts entered on the Dividend worksheet (div) for Unfranked dividends rounded down to the nearest dollar. If the worksheet is not used, key the amount to be included in assessable income. Show only the taxpayer's share of any jointly held Unfranked dividends.

When entering Unfranked dividends for non-Residents, select from the list the rate of tax to be applied to the Unfranked dividends. This is only required for the correct calculation of the withholding tax to be included in the tax estimate.

Label T - Franked amount

This is the total of amounts entered on the worksheet for franked dividends rounded down to the nearest dollar. If the Dividend worksheet (div) is not used, key the amount to be included in assessable income. Show only the taxpayer's share of jointly held dividends.

Label U - Franking credits

This is the total franking credit calculated in the worksheet at 30% of the amount entered as the Franked amount for each transaction. If the Dividend worksheet (div) is not used, key the amount to be included in assessable income. Show only the taxpayer's share of jointly held dividends.

Label V - TFN amounts withheld

This is the total amount entered on the worksheet for tax withheld where no TFN was quoted. If the Dividend worksheet (div) is not used, key the amount to be included in assessable income. Show only the taxpayer's share of jointly held dividends. The total amount of tax withheld cannot be more than 50% of the Unfranked amount.

Related Topics

Dividend Deductions (ddd)

Interest and Dividend Deductions (BJ)

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CCH References

4-100 Taxation of dividend recipients

10-490 Dividends and distributions

Item 12-Employee share schemes

Click this link for Item 12 - Employee share schemes information on the ATO website.

This question is about discounts on 'employee share scheme interests' (ESS interests) that you received under an employee share scheme.

Refer to the publication Employee share schemes - employees available on the ATO website.

Refer to Foreign income exemption for Australian residents and temporary residents - employee share schemes on the ATO website.

The Employee share schemes discount amount shown at label B is calculated and integrates from the worksheet (emp). Click any label A-G at this item to open the emp worksheet, refer to Employee Share Schemes worksheet (emp).

Label D-Discount from taxed upfront schemes – eligible for reduction

Generally, the difference between the market value of an ESS interest and what an employee pays for the interest is the amount that will be taxed upfront.

Add up all the discount amounts you received from 'taxed-upfront schemes eligible for reduction' including amounts shown on your employee share scheme statements and any foreign source discounts you received.

Enter the whole amount of the discount. Tax will calculate the assessable discount after applying the income test.

Label E-Discount from taxed upfront schemes – not eligible for reduction

Enter the amount of discount where the scheme does not meet the conditions for deferral because the shares are not at a real risk of forfeiture or acquired under a salary sacrifice arrangement.

Add up all the discount amounts you received from 'taxed-upfront schemes not eligible for reduction' including amounts shown on your employee share scheme statements and any foreign sourced discounts you received.

Label F-Discount from deferral schemes

Add up all the discount amounts you received from 'tax-deferred schemes' where a 'deferred taxing point' occurred during the current income year including amounts shown on your employee share scheme statements and any foreign source discounts you received.

Label G-Assessable discount on shares acquired pre-1 July 2009 ‘cessation time’ occurred during the financial year

Add up all the discount amounts from employee share scheme interests you acquired before 1 July 2009 where:

• you did not make an election to be taxed upfront at the time you received them, and

• a 'cessation time' occurred during the current financial year.

Label B-Total assessable discount amount

This is the total amount of discount that is to be included in assessable income. Tax will calculate this amount which is the taxpayer's income test income is less than $180,000 is the sum of labels D, E, F and G.

Where the taxpayer’s income test income is $180,000 or more, MYOB Tax will not allow the $1,000 discount and the amount at label B will be the sum of D - 1,000 plus E, F and G.

Label C-TFN Amounts withheld from discounts

If the taxpayer did not provide a TFN or an ABN to the employer, then tax at the top marginal rate plus the Medicare levy will have been deducted.

Any such amounts withheld should be entered at label C.

Label A-Foreign source discounts

If you paid foreign income tax in respect of any discounts you received on ESS interests shown at labels D, E, F and G above, you may be entitled to claim a foreign income tax offset. The offset will be claimed at item 20.

You will not be entitled to claim a foreign income tax offset for any discounts that relate to a period when you were a foreign resident for income tax purposes.

Write at A the total amount of your discounts from ESS interests for which you are claiming a foreign income tax offset and include the foreign tax paid at the Foreign tax paid field.

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CCH References

10-080 Employee share schemes

10-085 Application of Div 83A