Taxation Review Authority confirms that backdated ACC weekly compensation is taxed in the year of receipt
The disputant challenged her income tax assessment for the tax year ended 31 March 2018 (the Period in Dispute). The Accident Compensation Corporation (“ACC”) made a gross payment of $180,951.22 (the Weekly Compensation Payment) to the disputant in the Period in Dispute. The Commissioner of Inland Revenue (“the Commissioner”) taxed the entire Weekly Compensation Payment in the Period in Dispute when the disputant received it.
Case
Disputant v Commissioner of Inland Revenue [2021] NZTRA 3
Legal terms
Backdated ACC weekly compensation, Income, derive, cash or accruals basis
Income Tax Act 2007, s BD 3; Accident Compensation Act 2001, s 252.
Disputant v Commissioner of Inland Revenue [2021] NZTRA 3