We are frequently asked if workers compensation claims (including WorkCover payments) are taxable. The answer depends on whether it is a weekly income payment or a lump sum settlement.
Yes. The weekly WorkCover payments which an injured worker receives while unable to work, are treated like salary and are therefore taxable.
No, they a tax-free. Lump sum payments made by Workcover for permanent impairment (the degree to which you are assessed as being physically impaired as a result of the injury) and damages you are awarded from a common law claim are not taxable.
It’s important to get advice for your specific situation. Check if you can make a risk-free compensation claim and get free initial advice from our Principal lawyer, Greg Smith.
Find out which types of work injuries you may need a lawyer for (and which don't) plus time limits to make a claim. Queensland work injury claim experts.
Find out your rights if you've been injured at work. Common questions inc. Can I be fired? Can I return to work? Steps to start a claim. Get help now.