Tax treatment of COVID-19 Government payments: Bill (No 2) 2021 introduced

August 5, 2021
The Treasury Laws Amendment (COVID-19 Economic Response No 2) Bill 2021, introduced in the House of Reps on 3 August 2021 as 5 Schedules to the Bill, proposes amendments to the ITAA 1997 and TAA in relation to the tax treatment of Government COVID-19 Economic Response payments for business and individuals:
  • Coronavirus economic response payments Date of effect: after the Bill receives Royal Assent, applicable between 1 July 2021 to 31 December 2022.
  • Disclosure of tax information to Govt agencies for the purposes of administering COVID-19 business support programs. Date of effect: The day after Royal Assent.
  • Tax-free treatment of COVID-19 business support payments Date of effect: The day after Royal Assent, applicable to assessments on or after 1 July 2021.
  • Modification power – a temporary mechanism, reintroduced to change arrangements for meeting information and documentary requirements, in response to COVID-19. Date of effect: The day after Royal Assent until 31 December 2022.
  • Tax-free treatment of COVID-19 disaster payments – the ITAA 1997 will be amended to make COVID-19 disaster payments for individuals non-assessable non-exempt income. Date of effect: applicable from 2020-21 for qualifying payments.