ABC Pty Ltd carries on a high quality retail perfume business in the duty free section of Melbourne Airport. It is the sole agent of seven international perfume products which it sells in its airport shop. In January 20XX, one of its seven perfume sole agencies that it conducted at its airport outlet, generating 30% - 45% of its total income, was cancelled by the Christian Dior Perfume Company. The company received $800,000 from the Christian Dior Perfume Company as a consequence of the loss of the contract.

REQUIRED Advise the directors of ABC Pty Ltd as to tax consequences of receiving the compensation of $800,000. Students should refer to any appropriate legislation and case law.