ageing population

Proof of life certificates

‘Proof of life’ certificates required for overseas pensioners One of the stranger pieces of legislation to be introduced into Parliament last month is an attempt to ensure that overseas welfare recipients over the age of 80 are in fact, alive. There are approximately 96,000 people permanently living overseas who currently receive an Australian social security…

Defined Benefit Pensions

Defined Benefit Pensions

For the purposes of the $1.6m pension cap (transfer balance cap), defined benefit pensions (e.g. lifetime pensions historically received in the public sector and some private sector legacy pensions, such as market linked pensions) will be subject to special valuation rules as these pensions do not generally have an underlying capital balance (ie they are…

Super Reform: What SMSFs absolutely need to consider before 30 June

Transition to Retirement Pensions

Transition to retirement pensions will not qualify for any earnings tax exemption from 1 July 2017. All earnings on transition to retirement pension assets will be taxed at the standard super fund tax rate of 15%. A transition to retirement pension is generally a pension received by someone between the ages of 55 to 65…

gavel

Capital Gains Tax (CGT) relief

CGT relief The new rules include CGT relief for those who will be required to unwind existing pension arrangements. The CGT provisions effectively deem a disposal and reacquisition as at 30 June 2017, meaning any unrealised gains on existing pension assets will generally not be taxed on a disposal following commencement of the new rules.…

$1.6m Pension Cap (Transfer Balance Cap)

$1.6m Pension Cap (Transfer Balance Cap)

There will be a $1.6m cap on the amount of capital that a person can transfer into retirement products such as superannuation, pensions and annuities. The transfer balance cap applies from 1 July 2017 and applies to both existing and new pensions. The cap is an individual cap and applies on an individual-by-individual basis taking…

Super Reform: What SMSFs absolutely need to consider before 30 June

Pension Balance Transfer Cap ($1.6m) – how it works

The government recently released the second tranche of proposed superannuation changes covering the pension transfer balance cap, concessional contribution changes, catch-up concessional contributions and the removal of the earnings tax exemption for transition to retirement pensions.  We provide the following information on the issues surrounding the pension balance transfer cap. What is the pension transfer balance…