Last amended: 10 March 2011
In addition to the income stream schedule, a self managed superannuation fund (SMSF) or small APRA fund (SAF) must supply the following documentation to determine whether an income stream is an asset test exempt income stream [2][glossary:.:]:
Actuarial certificates are valid for one year, ending on 30 June. The first actuarial certificate issued for an income stream will be valid for the period between the commencement day [2] and 30 June. When the actuarial certificate expires, a 26 week grace period applies, during which, the income stream retains asset test exempt status. If a new certificate has still not been supplied at the end of the grace period, the income stream is reassessed as if it had never been asset test exempt. Any resulting overpayment should be recovered under existing policy.
More ? [4]
If the actuarial certificate does not express a positive opinion (or a high probability that the fund will be able to meet the income stream payments required) under Guidance Note 465, the income stream will retain asset test exempt status for 12 weeks to allow time for the income stream to be rolled over to a new asset test exempt income stream, or in the case of an error in the certificate, to obtain a new certificate expressing a positive opinion.
If no action is taken, the income stream will lose its asset test exempt status and become asset tested at the end of the 12 week period. The pensioner will be assessed as if the income stream never had asset test exempt status from the commencement day. This may result in a debt being raised.
More ? [5]
In recognition of the global financial crisis of 2008 and 2009, temporary relief has been provided for holders of 100% asset test exempt income streams sourced from a SMSF or SAF who fail to meet the high probability test.
More ? [6]
Waiver of debt under temporary debt relief arrangements
10.5.5/Assessment where Fund Closes or is in Financial Difficulty [12]
An income stream is an asset-test exempt income stream if it is purchased before 20 September 2007 and must be:
and:
Legislative reference:
Veterans' Entitlements Act 1986:
The commencement day in relation to an income stream [2] is the first day of the period to which the first income stream payment relates. This is usually one instalment period before the date of the first income payment.
The commencement day cannot occur prior to:
Legislative reference: subsection 5J(1) of the Veterans' Entitlements Act 1986.
Links
[1] https://clik.dva.gov.au/user/login?destination=node/16448%23comment-form
[2] https://clik.dva.gov.au/%23
[3] https://clik.dva.gov.au/book/export/html/16448#tgt-cspol_part10_ftn665
[4] https://clik.dva.gov.au/book/export/html/16448#tgt-cspol_part10_ftn666
[5] https://clik.dva.gov.au/book/export/html/16448#tgt-cspol_part10_ftn667
[6] https://clik.dva.gov.au/book/export/html/16448#tgt-cspol_part10_ftn668
[7] http://www.actuaries.asn.au
[8] http://WWW.actuaries.asn.au
[9] https://clik.dva.gov.au/book/export/html/16448#ref-cspol_part10_ftn665
[10] https://clik.dva.gov.au/compensation-and-support-reference-library/overpayment-management-manual/ch-7-recovery-and-other-methods-finalising-debts
[11] https://clik.dva.gov.au/book/export/html/16448#ref-cspol_part10_ftn666
[12] https://clik.dva.gov.au/compensation-and-support-policy-library/part-10-types-income-and-assets/105-income-streams/1055-special-provisions-regarding-self-managed-superannuation-funds-and-small-apra-funds/assessment-where-fund-closes-or-financial-difficulty
[13] https://clik.dva.gov.au/book/export/html/16448#ref-cspol_part10_ftn667
[14] https://clik.dva.gov.au/book/export/html/16448#ref-cspol_part10_ftn668
[15] http://www.comlaw.gov.au/Series/C2004A03268