Asset-test Exempt Income Stream (Lifetime Income Stream Guidelines) Determination 1998 (18/09/1998)

Asset-test Exempt Income Stream (Lifetime Income Stream Guidelines) Determination 1998

as amended

made under subsection 9A(6) of the

Social Security Act 1991

This compilation was prepared on 19 December 2008
taking into account amendments up to Asset-test Exempt Income Stream (Lifetime Income Stream Guidelines) Amendment Determination 1999 (No. 1)

Prepared by the Public Law Branch,
Department of Families, Housing, Community Services and Indigenous Affairs, Canberra

Asset-test Exempt Income Stream (Lifetime Income Stream Guidelines) Determination 1998

made under the

Social Security Act 1991

Contents

 Page

Part 1 Preliminary

1.1 Name of determination

1.2 Commencement

1.3 Definitions

1.4 Purpose

Part 2 Guidelines

2.1 Lifetime income stream under a public sector fund or
superannuation scheme

2.2 Lifetime income stream under a private sector fund

Notes

Part 1 Preliminary

1.1 Name of determination

  This determination is the Asset-test Exempt Income Stream (Lifetime Income Stream Guidelines) Determination 1998.

1.2 Commencement

  This determination commences on 20 September 1998.

1.3 Definitions

  In this determination:

Act means the Social Security Act 1991.

defined benefit fund has the same meaning as in subregulation 1.03 (1) of the Superannuation Industry (Supervision) Regulations.

defined benefit superannuation pension means a pension product that pays a superannuation pension from a defined benefit fund.

lifetime income stream, in relation to a person, means an income stream in which payments are made, at least annually, throughout the life of the person and, if there is a reversionary beneficiary, throughout the life of the reversionary beneficiary.

private sector fund has the same meaning as in subsection 10 (1) of the Superannuation Industry (Supervision) Act 1993.

public sector fund has the same meaning as in subsection 10 (1) of the Superannuation Industry (Supervision) Act 1993.

public sector superannuation scheme has the same meaning as in subsection 10 (1) of the Superannuation Industry (Supervision) Act 1993.

superannuation fund has the same meaning as in subsection 10 (1) of the Superannuation Industry (Supervision) Act 1993.

superannuation pension means a pension payable from a superannuation fund.

Note   The following expressions used in this determination are defined in the Act (see ss 9 (1), 9 (1E), 9A and 9B):

· asset-test exempt income stream

· commencement day

· defined benefit income stream

· governing rules

· income stream.

1.4 Purpose

  The purpose of this determination is to set out the guidelines for the exercise of the Secretary’s discretion, under subsection 9A (5) of the Act, to determine that an income stream that does not meet the requirements of subsection 9A (2) is an asset-test exempt income stream for the purposes of the Act.

Part 2 Guidelines

2.1 Lifetime income stream under a public sector fund or superannuation scheme

 (1) In making a determination under subsection 9A (5) of the Act in relation to an income stream arising under a public sector fund or a public sector superannuation scheme, the Secretary must have regard to this section.

 (2) The income stream must be a lifetime income stream that is a defined benefit income stream, the amount of payments under which is determined by the governing rules of the fund or scheme, and that:

 (a) is a defined benefit superannuation pension; or

 (b) is a superannuation pension under an exempt public sector superannuation scheme, within the meaning of section 10 of the Superannuation Industry (Supervision) Act 1993, being a scheme to which subregulation 1.04 (4A) of the Superannuation Industry (Supervision) Regulations 1994 applies in accordance with subregulation 1.04 (4E) of those Regulations.

 (3) The fund or scheme must have been established before 20 September 1998 and:

 (a) for an income stream commencing before 20 September 1998 — the value of the income stream is disregarded in calculating the value of the assets of the person concerned, because of section 1118 of the Act as in force immediately before 20 September 1998 (the previous section 1118); or

 (b) for an income stream commencing on or after 20 September 1998, that is a defined benefit superannuation pension existing before 20 September 1998 — the value of the income stream would have been disregarded in calculating the value of the person’s assets under the previous section 1118 as it would have applied if:

 (i) the commencement day of the income stream was before 20 September 1998; and

 (ii) defined benefit superannuation pension payments were made before 20 September 1998.

2.2 Lifetime income stream under a private sector fund

 (1) In making a determination under subsection 9A (5) of the Act in relation to an income stream arising under a private sector fund, the Secretary must have regard to this section.

 (2) The income stream must be a lifetime income stream that:

 (a) is a defined benefit income stream, the amount of payments under which is determined by the governing rules of the fund; and

 (b) is a defined benefit superannuation pension.

 (3) The fund must have been established before 20 September 1998 and:

 (a) for an income stream commencing before 20 September 1998 — the value of the income stream is disregarded in calculating the value of the assets of the person concerned, because of section 1118 of the Act as in force immediately before 20 September 1998 (the previous section 1118); or

 (b) for an income stream commencing on or after 20 September 1998, that is a defined benefit superannuation pension existing before 20 September 1998 — the value of the income stream would have been disregarded in calculating the value of the person’s assets under the previous section 1118 as it would have applied if:

 (i) the commencement day of the income stream was before 20 September 1998; and

 (ii) defined benefit superannuation pension payments were made before 20 September 1998.

 (4) The fund must have a direct connection with the previous employment of the recipient of the income stream or, in the case of a reversionary beneficiary, the person who would be the recipient if he or she had not died.

 (5) For subsection (4), a fund has a direct connection with a person’s previous employment if the income stream from the fund became payable to, or in respect of, the person because of that employment.

Notes

Note 1

The Asset-test Exempt Income Stream (Lifetime Income Stream Guidelines) Determination 1998 (in force under subsection 9A(6) of the Social Security Act 1991) as shown in this compilation is amended as indicated in the Tables below.

Table of Instruments

Table of Amendments