The Government will make minor extensions to the CGT exemptions for certain compensation payments and insurance policies. This measure will disregard CGT consequences where a taxpayer receives compensation, damages or certain insurance proceeds indirectly through a trust. This will ensure that the taxpayer has the same CGT outcome as a taxpayer who receives such proceeds directly. It will also ensure that insurance policies owned by superannuation funds that were treated as being CGT exempt prior to the 2011-12 Budget changes to compensation payments and insurance policies continue to be CGT exempt.
Date of effect: The measures will apply with effect from the 2005-06 income year.
Source: Budget Paper No 2 [p 20]
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