You are here

Payment Factors for Market Linked Income Streams

Document

Last amended: 3 September 2013

Use of payment factors

These payment factors are used in determining the annual payment to be paid by a market linked income stream.

Rules determining the choice of payment factor

The following rules determine which payment factor is to be used:

  • for income streams commencing between 1 July and 31 December, the remaining term of the income stream is rounded down to the next whole number
  • for income streams commencing between 1 January and 30 June, the remaining term of the income stream is rounded up to the next whole number

This table prescribes which minimum payment factors to use based for the term of the income stream at its commencement day and then for the remaining term of the income stream on each 1 July thereafter.

Remaining term of income stream (years)

Payment factor

Remaining term of income stream (years)

Payment factor

70

26.00

35

20.00

69

25.91

34

19.70

68

25.82

33

19.39

67

25.72

32

19.07

66

25.62

31

18.74

65

25.52

30

18.39

64

25.41

29

18.04

63

25.30

28

17.67

62

25.19

27

17.29

61

25.07

26

16.89

60

24.94

25

16.48

59

24.82

24

16.06

58

24.69

23

15.62

57

24.55

22

15.17

56

24.41

21

14.70

55

24.26

20

14.21

54

24.11

19

13.71

53

23.96

18

13.19

53

23.80

17

12.65

51

23.63

16

12.09

50

23.46

15

11.52

49

23.28

14

10.92

48

23.09

13

10.30

47

22.90

12

9.66

46

22.70

11

9.00

45

22.50

10

8.32

44

22.28

9

7.61

43

22.06

8

6.87

42

21.83

7

6.11

41

21.60

6

5.33

40

21.36

5

4.52

39

21.10

4

3.67

38

20.84

3

2.80

37

20.57

2

1.90

36

20.29

1 or less

1.00

For the financial years commencing on 1 July 2008 and ending 30 June 2013, temporary relief measures were applied by the Government in response to the Global Financial Crisis to allow all market linked income stream recipients to elect to reduce their minimum annual payment to :

  • 50% of the required minimum payment for the financial years commencing 1 July 2008 and ending 30 June 2011; and
  • 75% of the required minimum payment for the financial years commencing 1 July 2011 and ending 30 June 2013.

These temporary relief measures ceased to apply from 1 July 2013.


Annual payment means the amount payable to the person for the year under the income stream.

According to section 5J(1) of the VEA, an income stream includes:

  • an income stream arising under arrangements that are regulated by the Superannuation Industry (Supervision) Act 1993; or
  • an income stream arising under a public sector scheme (within the meaning of that Act); or
  • an income stream arising under a retirement savings account; or
  • an income stream provided by a life insurance business (within the meaning of the Life Insurance Act 1995); or
  • an income stream provided by a friendly society (within the meaning of the Income Tax Assessment Act 1996); or
  • an income stream designated in writing by the Commission for the purposes of this definition, having regard to the guidelines determined under subsection 5J(1F) of the VEA;
  • but does not include any of the following:
  • available money;
  • deposit money;
  • a managed investment;
  • a listed security;
  • a loan that has not been repaid in full;
  • an unlisted public security; or
  • gold, silver or platinum bullion.