---
title: "Add back tax paid on compensation that must be repaid"
url: "https://ailawframework.com/practice/personal-injury-and-compensation/add-back-tax-paid-on-compensation-that-must-be-repaid"
type: "task"
site: "AI Law Framework"
id: "A21-DM20261023-4"
practice_area: "Personal Injury & Compensation (workers compensation, CTP/TAC, medical negligence)"
tier: "yellow"
lawyer_review: "required"
last_reviewed: "2026-10-25"
---

# Add back tax paid on compensation that must be repaid

> From the compensation and tax figures the lawyer has accepted, the firm-controlled tool shows the difference between the gross amount to be repaid and the net amount the client kept.…

Canonical page: https://ailawframework.com/practice/personal-injury-and-compensation/add-back-tax-paid-on-compensation-that-must-be-repaid  
Last reviewed: 2026-10-25

Site index for agents: https://ailawframework.com/llms.txt

## Key facts

| Fact | Value |
| --- | --- |
| Practice area | [Personal Injury & Compensation (workers compensation, CTP/TAC, medical negligence)](https://ailawframework.com/practice/personal-injury-and-compensation.md) |
| Human involvement | Yellow: Lawyer and AI draft together |
| How AI is used | From the compensation and tax figures the lawyer has accepted, the firm-controlled tool shows the difference between the gross amount to be repaid and the net amount the client kept. It does not write a schedule that will be filed or served. |
| What the lawyer must review | You take the gross repayment and the net amount kept from the compensation records. You decide whether that difference is recoverable on this claim. Use a firm-controlled tool. Wage, tax and care records are confidential under ASCR r 9 and APP 11. Decide whether a breach would be notifiable under the Privacy Act 1988 (Cth). |
| Written for / versions | 3 jurisdiction versions below |

## Checking plan

**Source-by-source verification**

Show the tax difference from figures the lawyer has accepted. Do not treat a capital-gains disregard as an income-tax exemption.

- What the AI does: From the compensation and tax figures the lawyer has accepted, the firm-controlled tool shows the difference between the gross amount to be repaid and the net amount the client kept. It does not write a schedule that will be filed or served.
- What the lawyer does: You take the gross repayment and the net amount kept from the compensation records. You decide whether that difference is recoverable on this claim. Use a firm-controlled tool. Wage, tax and care records are confidential under ASCR r 9 and APP 11. Decide whether a breach would be notifiable under the Privacy Act 1988 (Cth).
- Who reviews: Responsible lawyer with competence in the matter
- Basis: Practical workflow informed by the linked primary sources; the traffic light and working checks are editorial guidance, not a court classification.
- Why: The level reflects what the work is, the consequence of an error, and how much of the output the lawyer must independently re-derive.
- Restriction: The lawyer sets the rates, hours, percentages and net weekly loss. The tool shows arithmetic only from figures the lawyer has accepted.

## Checks the lawyer makes

1. Use the gross and net figures from the compensation records, not a tax rate taken from a case.
2. Do not treat Income Tax Assessment Act 1997 s 118-37 as making the repayment, or a damages lump sum, free of income tax.
3. On a New South Wales motor-accident award, check the difference against Motor Accident Injuries Act 2017 s 4.5(1)(d).
4. Do not invent a repayment mechanism. The repayment section of each scheme was not opened.

## Notes

- These are suggested working checks. Confirm the required checking with the responsible lawyer before work starts; the checking approach does not establish permission to use AI.
- If a figure is copied into a document filed in court, the lawyer checks that court's generative-AI practice note. The opened notes are the New South Wales Supreme Court page for Practice Note SC Gen 23, the Victorian Supreme Court news page for Practice Note SC Gen 25, and the Law Society of NSW court-protocols page. The practice-direction PDFs were not opened.

## Sources

- [Fox v Wood 1981 HCA 41](https://classic.austlii.edu.au/au/cases/cth/HCA/1981/41.html) (checked 2026-10-23)
- [Motor Accident Injuries Act 2017 (NSW) s 4.5](https://classic.austlii.edu.au/au/legis/nsw/consol_act/maia2017245/s4.5.html) (checked 2026-10-23)
- [Workers Compensation Act 1987 (NSW) s 151G](https://classic.austlii.edu.au/au/legis/nsw/consol_act/wca1987255/s151g.html) (checked 2026-10-23)
- [Income Tax Assessment Act 1997 (Cth) s 118-37](https://www8.austlii.edu.au/cgi-bin/viewdoc/au/legis/cth/consol_act/itaa1997240/s118.37.html) (checked 2026-10-23)

## Jurisdiction versions

| Jurisdiction | Level |
| --- | --- |
| [Victoria](https://ailawframework.com/practice/personal-injury-and-compensation/add-back-tax-paid-on-compensation-that-must-be-repaid/victoria.md) | Yellow |
| [New South Wales](https://ailawframework.com/practice/personal-injury-and-compensation/add-back-tax-paid-on-compensation-that-must-be-repaid/new-south-wales.md) | Yellow |
| [Queensland](https://ailawframework.com/practice/personal-injury-and-compensation/add-back-tax-paid-on-compensation-that-must-be-repaid/queensland.md) | Yellow |

*Practice guidance for planning and review. Confirm current primary sources and the requirements of the actual matter. This is general information, not legal advice.*