Part 1 Preliminary
1.01 Name
of Regulations [see
Note 1]
These Regulations are the Superannuation
Industry (Supervision) Regulations 1994.
1.02 Commencement [see
Note 1]
The following provisions of these Regulations
commence on 1 July 1994:
(a) Division 2.2;
(b) Subdivision 2.8.2;
(c) Regulations 3.10, 3.11 and 3.12;
(d) Division 6.5;
(e) Parts 9 and 10;
(f) Regulation 11.08;
(g) Part 12.
1.03 Interpretation
(1) In these regulations, unless the contrary intention
appears:
1997 Tax Act means
the Income Tax Assessment Act 1997.
account‑based
pension means a pension that is provided in accordance with the
rules of a fund that:
(a) are described in
paragraph 1.06 (9A) (a); and
(b) meet the standards
of subregulation 1.06 (9A).
accumulation fund means a regulated
superannuation fund that is not a defined benefit fund.
accumulation interest means a superannuation
interest that is not a defined benefit interest.
Act means the Superannuation Industry
(Supervision) Act 1993.
adjusted base amount,
in relation to a non‑member spouse at a particular date, means the
adjusted base amount applicable to the non‑member spouse at that date
worked out under Division 6.1A of the Family Law (Superannuation)
Regulations 2001.
advance instalment of surcharge means the
advance instalment payable under section 11 of the Superannuation
Contributions Tax (Assessment and Collection) Act 1997.
allocated pension means a pension that is
provided under
rules of a superannuation fund that meet the standards of subregulation
1.06 (4).
allot, for Division 6.7, means to credit an
amount from a member’s account to another account in the regulated
superannuation fund held by, or created for, the receiving spouse otherwise
than by transfer or roll‑over.
base amount payment split, in relation to a
superannuation interest, means a payment split under which a base amount is
allocated to the non‑member spouse in relation to the interest under Part
VIIIB of the Family Law Act 1975.
benefit certificate has the meaning given by
section 10 of the SG(A) Act.
capital gains tax exempt
component has the same meaning as CGT exempt component
in subsection 27A (1) of the Tax Act as in force immediately before 1 July
2007.
child contributions means contributions that
are made to a regulated superannuation fund in respect of a child, other than:
(a) contributions made in respect of the child
by, or on behalf of, an employer of the child; and
(b) contributions made by a child in respect of
himself or herself.
Co‑contribution Act means the Superannuation
(Government Co‑contribution for Low Income Earners) Act 2003.
commencement day, in relation to a pension or
an annuity, means the first day of the period to which the first payment of the
pension or annuity relates.
contributions, in relation to a fund,
includes:
(a) payments of shortfall components to the
fund; and
(b) payments to the fund from the Superannuation Holding Accounts Special Account;
but does not include benefits that have been rolled over or
transferred to the fund.
defined benefit fund means:
(a) a public sector superannuation scheme that:
(i) is a regulated superannuation
fund; and
(ii) has at least 1 defined benefit
member; or
(b) a regulated superannuation fund (other than a
public sector superannuation scheme):
(i) that has at least 1 defined
benefit member; and
(ii) some or all of the contributions
to which (out
of which, together with earnings on those contributions, the benefits are to be
paid) are not paid into a fund, or accumulated in a fund, in respect of any
individual member but are paid into and accumulated in a fund in the form of an
aggregate amount.
defined benefit interest has the meaning
given by regulation 1.03AA.
defined benefit member means a member
entitled, on retirement or termination of his or her employment, to be paid a
benefit defined, wholly or in part, by reference to either or both of the
following:
(a) the amount of:
(i) the member’s salary at a
particular date, being the date of the termination of the member’s employment
or of the member’s retirement or an earlier date; or
(ii) the member’s salary averaged over
a period before retirement; or
(b) a specified amount.
eligible rollover fund has the same meaning
as in Part 24 of the Act.
Note As to what is an eligible
rollover fund for Part 24 of the Act, see section 242 of
the Act and regulation 10.01.
eligible spouse contribution means a
contribution made by an individual to a superannuation fund:
(a) to provide
superannuation benefits for the individual’s spouse, whether or not the
benefits would be payable to the dependants of the individual’s spouse if the
spouse dies before or after becoming entitled to receive the benefits; and
(b) in circumstances in which the individual:
(i) could
not have deducted the contribution under section 82AAC of the Tax Act in the
2006–07 income year or a previous year; and
(ii) cannot
deduct the contribution under Subdivision 290‑B of the 1997 Tax Act in
the 2007–08 income year or a later year.
eligible termination payment has the same
meaning as in Subdivision AA of Division 2 of Part III of the Tax Act.
employer contribution, in relation to a
regulated superannuation fund, means a contribution by, or on behalf of, an
employer‑sponsor of the fund.
EPSSS means an exempt public sector
superannuation scheme.
excluded member
means:
(a) a member of a regulated superannuation fund
that is a self managed superannuation fund; or
(b) a defined benefit member of a defined benefit
fund.
FHSA Act means the First Home Saver
Accounts Act 2008.
flag lifting agreement means a flag lifting
agreement under Part VIIIB of the Family Law Act 1975.
FSR commencement has the same meaning as in
section 1410 of the Corporations Act 2001.
Note The FSR commencement
is the commencement of item 1 of Schedule 1 to the Financial Services Reform
Act 2001.
full‑time, in relation to being
gainfully employed, means gainfully employed for at least 30 hours each week.
gainfully employed means employed or self‑employed
for gain or reward in any business, trade, profession, vocation, calling,
occupation or employment.
growth phase has the meaning given by regulation
1.03AB.
industrial authority
means:
(a) a court, or a tribunal or other body or
person, constituted under a law of the Commonwealth, a State or a Territory
with power of conciliation or arbitration in relation to industrial disputes;
or
(b) a special board constituted under the law of
a State relating to factories.
life expectancy has the same meaning as life
expectation factor in section 27H of the Tax Act.
lost member has the meaning given by
regulation 1.03A.
lost RSA holder has the meaning given by
regulation 1.06 of the RSA Regulations.
market linked annuity means an annuity
provided under a contract that meets the standards of subregulation 1.05 (10).
market linked income stream means an annuity
provided under a contract that meets the standards of subregulation 1.05 (10),
or a pension paid under rules that meet the standards of subregulation 1.06
(8).
market linked pension means a pension paid
under rules that meet the standards of subregulation 1.06 (8).
member, except in Part 2, means:
(a) in relation to an approved deposit
fund — a depositor in the fund; and
(b) in relation to a regulated superannuation
fund — a member of the fund; and
(c) in relation to a PST — a unit‑holder
in the PST.
Note The meaning of the term ‘member’ in
Part 2 is defined in subregulation 2.01 (2).
member‑protection standards means the
standards set out in subregulation 5.17 (2) and regulation 5.18.
member spouse, in relation to a
superannuation interest that is subject to a payment split, means the person
who is the member spouse in relation to the interest under Part VIIIB of the Family
Law Act 1975.
minimum requisite benefit, in relation to a
member, means the benefit certified by an actuary in a relevant benefit
certificate as the minimum benefit in respect of the member.
non‑member spouse, in relation to a
superannuation interest that is subject to a payment split, means the person
who is the non‑member spouse in relation to the interest under Part VIIIB
of the Family Law Act 1975.
old Regulations means these Regulations as in
force immediately before the FSR commencement.
operative time, for a payment split, means
the operative time under Part VIIIB of the Family Law Act 1975 for the
payment split.
part‑time, in relation to being
gainfully employed, means gainfully employed for at least 10 hours, and less
than 30 hours, each week
payment split means a payment split under
Part VIIIB of the Family Law Act 1975.
payment split notice means a notice given by
a trustee under regulation 7A.03.
pension age:
(a) in relation to a person other than a person
mentioned in paragraph (b) — has the meaning given by subsections 23 (5A),
(5B), (5C) or (5D) of the Social Security Act 1991; and
(b) in relation to a person who is a veteran
within the meaning of the Veterans’ Entitlement Act 1986 — has the
meaning that it has in section 5QA of that Act.
percentage‑only interest has the
meaning given by Part VIIIB of the Family Law Act 1975.
percentage payment split, in relation to a
superannuation interest, means a payment split under a superannuation
agreement, flag lifting agreement or splitting order that specifies a
percentage that is to apply to all splittable payments in respect of the
interest.
protected member has the meaning given by
regulation 1.03B.
PST means a pooled superannuation trust.
receiving spouse has the meaning given by
regulation 6.46.
relevant benefit
certificate, in relation to a regulated superannuation fund, means a
benefit certificate that relates to a defined benefit superannuation scheme
(within the meaning of the SG(A) Act) of which the fund forms part.
relevant entity
means:
(a) a public offer entity; or
(b) an approved deposit fund.
Note The expression relevant entity
is defined in the same terms as in section 22 of the Act.
reserves, in relation to a superannuation
entity, means reserves maintained under section 115 of the Act.
reviewable decision means a decision of the
Regulator:
(ba) to determine consent for subregulation
4.12 (2), paragraph 6.27B (b) or paragraph 7A.16 (8) (b);
or
(bb) to specify a day under regulation 12.08; or
(c) not to approve an application under
regulation 12.12 or 12.13; or
(d) to revoke an approval under regulation 12.14;
or
(e) after reconsideration under regulation
13.25, to confirm or vary a decision referred to in any of the preceding
paragraphs of this definition.
RSA Act means the Retirement Savings
Accounts Act 1997.
RSA holder has the same meaning given to the
term holder in section 9 of the RSA Act.
RSA institution has the meaning given by
section 11 of the RSA Act.
RSA Regulations means the Retirement Savings
Accounts Regulations.
SG(A) Act means the Superannuation
Guarantee (Administration) Act 1992.
shortfall component has the same meaning as
in the SG(A) Act.
splittable payment means a splittable payment
under Part VIIIB of the Family Law Act 1975.
splitting order means a splitting order under
Part VIIIB of the Family Law Act 1975.
successor fund, in relation to a transfer of
benefits of a member from a fund (called the original fund),
means a fund which satisfies the following conditions:
(a) the fund confers on the member equivalent
rights to the rights that the member had under the original fund in respect of
the benefits;
(b) before the transfer, the trustee of the fund
has agreed with the trustee of the original fund that the fund will confer on
the member equivalent rights to the rights that the member had under the
original fund in respect of the benefits.
superannuation agreement means a
superannuation agreement under Part VIIIB of the Family Law Act 1975.
superannuation contributions surcharge means
the superannuation contributions surcharge imposed by the Superannuation
Contributions Tax Imposition Act 1997.
Superannuation Holding
Accounts Special Account means the
Special Account established by section 8 of the Small Superannuation
Accounts Act 1995.
superannuation lump sum has the meaning given by subsection 995‑1 (1)
of the 1997 Tax Act.
Tax Act means the Income Tax Assessment
Act 1936.
transferable benefits, in relation to a
superannuation interest that is subject to a payment split and in relation to
the non‑member spouse in relation to that interest, means benefits that
are equal to:
(a) if the payment split is a base amount
payment split and an adjusted base amount applies to the non‑member spouse
when the benefits are transferred — the adjusted base amount less the
amount of any fees payable by the non‑member spouse in respect of the
payment split; or
(b) if the payment split is a base amount payment
split and
an adjusted base amount does not apply to the non‑ member spouse when the
benefits are transferred —
the base amount allocated to the non‑member spouse, within the meaning of
regulation 45 of the Family Law (Superannuation) Regulations 2001, less
the amount of any fees payable by the non‑member spouse in respect of the
payment split; or
(c) if the payment split is a percentage payment
split:
(i) for an
entitlement, in respect of an accumulation interest in the growth phase that is not a partially vested accumulation interest, to
which subparagraph (ii) does not apply — the amount in relation to
the interest at the time when the benefits are transferred, determined in the way in which a court would determine an
amount in accordance with regulation 28 and subregulation 31 (2A)
of the Family Law (Superannuation) Regulations 2001, multiplied by the
specified percentage, less the amount of any fees payable by the non‑member
spouse in respect of the payment split; or
(ii) for an entitlement in respect of
an interest in a self‑managed superannuation fund — the amount
in relation to the interest at the time when the benefits are transferred,
determined by a method that a court might use if the court were acting under
paragraph 90MT (2) (b) of the Family Law Act 1975, multiplied by the
specified percentage, less the amount of any fees payable by the non‑member
spouse in respect of the payment split; or
(iii) for an entitlement in respect of
any other interest — the amount in relation to the interest at the time
when the benefits are transferred, determined in the
way in which a court would determine an amount in accordance with the
relevant method in Part 5 of the Family Law (Superannuation) Regulations
2001, multiplied by the specified percentage, less the amount of any fees
payable by the non‑member spouse in respect of the payment split.
unfunded public sector superannuation scheme
means
a regulated superannuation fund that is declared to be
an unfunded defined benefits superannuation scheme
under regulation 2A of the Superannuation Contributions Tax (Assessment and
Collection) Regulations 1997.
withdrawal benefit, in relation to a member
of a superannuation entity, means the total amount of the benefits that would
be payable to:
(a) the member; and
(b) the trustee of another superannuation entity
or an EPSSS in respect of the member; and
(c) an RSA in respect of the member; and
(d) another person or entity because of a payment
split in respect of the member’s interest in the superannuation entity;
if the member voluntarily ceased to be a member.
(2) In these Regulations, other than Part 2:
fund means:
(a) an approved deposit fund; or
(b) a regulated superannuation fund.
Note For the meaning of fund
in Part 2, see subregulation 2.01 (3).
1.03A Lost
member
(1) A member of a fund is
taken to be a lost member at a particular time if:
(a) the member is uncontactable, that is, if and
only if:
(i) the fund has never had an address
for him or her; or
(ii) 2 written communications or, if
the trustee so chooses, 1 written communication have been sent by the fund to
the member’s last known address and returned unclaimed; or
(b) the member is
an inactive member, that is, if and only if:
(i) he or she has been a member of the
fund for longer than 2 years; and
(ia) he
or she was, at the time he or she joined the fund, a person in respect of whom
there was in effect a contribution arrangement of the kind referred to in
subsection 16 (5) of the Act (which deals with
the definition of standard employer‑sponsored member); and
(ii) the fund has not received a
contribution or rollover in respect of him or her within the last 5 years of his or her membership of the fund; or
(c) the member
joined the fund from another fund or an EPSSS as a lost member; or
(ca) the member joined the fund from an RSA provider
as a lost RSA holder;
unless:
(d) within the last 2 years of the member’s
membership, the trustee of the fund has verified that the member’s address is
correct and has no reason to believe that that address is now incorrect; or
(e) the member is permanently excluded from
being a lost member.
(2) For the purposes of subregulation (1), and subject
to subregulation (3), a member of a fund is permanently excluded from being a
lost member if:
(a) the member is an inactive member who has
indicated by a positive act (for example, deferring a benefit in the fund) that
he or she wishes to continue to be a member of the fund; or
(b) the member has contacted the fund at any time
after the time at which he or she joined the fund and indicated that he or she
wishes to continue being a member of the fund; or
(c) the member is a member of a self managed
superannuation fund.
(3) The trustee of a fund
may decide that:
(a) a member, a class of members, or all members
of the fund cannot be permanently excluded from becoming lost members; or
(b) a member who is, a class of members who are,
or all members of the fund who are permanently excluded from being lost is or
are not to continue being permanently excluded from being lost.
Note The
consequences of a member becoming a lost member are:
(a) that
the trustee of the fund must report certain details to the Commissioner (see
regulation 5 of the Superannuation (Unclaimed Money and Lost Members)
Regulations 1999); and
(b) that,
if the member is transferred to another fund or an EPSSS (the transferee
fund), the trustee of the transferring fund must supply certain
information about the member to the trustee of the transferee fund (see
regulation 7.9.81 of the Corporations Regulations 2001).
There may also be consequences regarding the information to
be supplied to the member (see regulation 7.9.61 of, and Part 14 of
Schedule 10A to, the Corporations Regulations 2001).
1.03AA Defined
benefit interest
(1) A superannuation interest is a defined
benefit interest if it is:
(a) an interest in an unfunded public sector
superannuation scheme that has at least 1 defined benefit member; or
(b) an interest that entitles the member who
holds the interest, when benefits in respect of the interest become payable, to
be paid a benefit defined, wholly or in part, by reference to one or more of
the following:
(i) the amount of:
(A) the member’s salary at
the date of the termination of the member’s employment, the date of the
member’s retirement, or another date; or
(B) the member’s salary
averaged over a period; or
(C) salary, or allowance in
the nature of salary, payable to another person (for example, a judicial
officer, a member of the Commonwealth or a State Parliament, a member of the
Legislative Assembly of a Territory);
(ii) a specified amount;
(iii) specified conversion factors.
(2) However, a superannuation interest is not a defined
benefit interest if the only benefits defined by reference to any of
the amounts or factors mentioned in subparagraphs (1) (b) (i) to (iii)
are benefits payable on death or invalidity.
1.03AB Meaning
of growth phase
(1) A superannuation interest is taken to be in the growth
phase at a particular date if the member satisfies 1 of the following
requirements at that date:
(a) the member has not satisfied a relevant
condition of release;
(b) the member has satisfied a relevant condition
of release but no benefit has been paid in respect of the superannuation
interest, and no action has been taken by or for the member under the governing
rules of the fund to cash any benefit that the member is entitled to be paid as
a result of satisfying the condition of release;
(c) the member has satisfied a relevant
condition of release and a benefit (other than a benefit that is paid as a
pension) has been paid to or for the benefit of the member or, if the member
has died, to his or her legal personal representative, but no action has been
taken by or for the member, or his or her legal personal representative, under
the governing rules of the fund to receive any other benefit that the member,
or his or her estate, is entitled to be paid as a result of satisfying the
condition of release.
(2) In this regulation:
relevant condition of release means a
condition of release mentioned in item 101, 102, 103, 106, 108, 201, 202, 203
or 206 of Schedule 1.
1.03B Meaning
of protected member
(1) A protected
member is a member of a regulated superannuation fund who has a
withdrawal benefit, or a benefit of any other type that is payable on leaving
the fund otherwise than voluntarily (not including any applicable exit fee),
that:
(a) is less than $1 000; and
(b) contains, or contained, benefits that are
mandated employer‑financed benefits (within the meaning of subregulation
5.01 (1)).
(2) An excluded member is not a protected member.
(3) If the trustee of a regulated superannuation fund
has rolled
over or transferred an amount that is the whole or part
of a member’s withdrawal benefit to another regulated superannuation fund or to
an approved deposit fund, RSA or EPSSS in accordance with Division 6.5, the
member is not a protected member of the fund from which the amount was rolled
over or transferred.
(4) For subregulation
(1), a benefit in a fund is taken to contain or to have contained mandated
employer‑financed benefits unless:
(a) if the benefits arose in relation to
contributions made before 1 July 1995 — the trustee of the fund reasonably
believes otherwise; or
(b) if the benefits arose in relation to
contributions made on or after 1 July 1995 — the trustee of the fund knows
otherwise.
1.04 Prescribed
matters (Act, s 10)
(1) The purpose of this regulation is to prescribe
matters for the purposes of various definitions in section 10 of the Act.
Approved auditor
(2) For the purposes of the definition of approved
auditor in section 10 of the Act, the following class of persons is
specified, namely, individuals each of whom:
(a) in the case of an auditor of a self managed
superannuation fund:
(i) is, under Division 2 of Part 9.2
of the Corporations Act 2001, registered, or taken to be registered, as
an auditor; or
(ii) is associated with a professional
organisation specified in Schedule 1AAA in the manner specified, in respect of
that organisation, in that Schedule; or
(iii) is the Auditor‑General of
the Commonwealth, a State or Territory, or is a delegate of the Auditor‑ General;
and
(b) in the case of an auditor of a superannuation
entity other than a self managed superannuation fund:
(i) is, under Division 2 of
Part 9.2 of the Corporations Act 2001, registered, or taken to be
registered, as an auditor; or
(ii) is the Auditor‑General of
the Commonwealth, a State or Territory, or is a delegate of the Auditor‑ General.
Excluded approved deposit fund
(4) For the purposes of paragraph (b) of the definition
of excluded approved deposit fund in section 10 of the Act, the
following condition is specified, namely, that the fund must be:
(a) a fund established before 1 July 1994; or
(b) a fund that was
established on or after 1 July 1994 using eligible termination payments (within
the meaning of the Tax Act as in force when the fund was established) of the
fund’s beneficiary that had an initial value of at least $400 000; or
(c) a fund that is
established after 1 July 2007 using a superannuation lump sum or an employment
termination payment (within the meaning of the 1997 Tax Act) of the fund’s
beneficiary that had an initial value of at least $400 000.
Exempt public sector superannuation
scheme
(4A) For the purposes of the definition of exempt
public sector superannuation scheme in section 10 of the Act the
schemes listed in Schedule 1AA are specified.
(4B) If a scheme listed in Schedule 1AA is re‑named,
the reference to that scheme includes the scheme as so re‑named.
(4C) Subregulation (4A) has effect in relation to a scheme
specified in Part 1 of Schedule 1AA in respect of the 1994‑95 and 1995‑96
years of income of that scheme.
(4D) Subregulation (4A) applies in relation to a scheme
specified in Part 2 of Schedule 1AA during the 1996‑97 year of income of
that scheme.
(4E) Subregulation (4A) applies in relation to a scheme
specified in Part 3 of Schedule 1AA during the 1997‑1998 year of income,
and subsequent years of income, of that scheme.
Pooled superannuation trust
(5) For the purposes of paragraph (b) of the definition
of pooled superannuation trust in section 10 of the Act, the
definition applies to a unit trust that is:
(a) used only for investing the following kinds
of assets:
(i) assets of a regulated
superannuation fund;
(ii) assets of an approved deposit
fund;
(iii) assets of a PST;
(iv) virtual PST assets of a life
insurance company within the meaning of the 1997 Tax Act;
(v) segregated exempt assets of a life
insurance company within the meaning of the 1997 Tax Act; and
Note 1 PST is defined
in regulation 1.03 to mean a pooled superannuation trust.
Note 2 Life insurance company,
segregated exempt assets and virtual PST asset, are
defined in subsection 995‑1 (1) of the 1997 Tax Act.
(b) a resident unit trust within the meaning of section
102H of the Tax Act; and
(c) a trust in
relation to which each of the following circumstances applies:
(i) the
trustee has confirmed in writing an intention to have the trust treated as a
PST;
(ii) the confirmation was given to
APRA, in the approved form, and signed and dated by the trustee;
(iii) the confirmation was given not
later than:
(A) the time of lodgment, in
accordance with subsection 36 (1) of the Act, of the first return in
relation to the trust after 12 July 2000 (the time of lodgment);
or
(B) such later time as
allowed, in writing, by APRA, either generally or in a particular case and
whether allowed before or after the time of lodgment;
(iv) the
confirmation has not been withdrawn.
(6) The trustee of a unit trust may confirm an intention
under paragraph (5) (c) despite anything in the governing rules of the
unit trust.
(7) The trustee of a unit trust mentioned in
subregulation (6) must inform APRA in writing as soon as practicable after the
unit trust ceases to be a PST because paragraph (5) (a) or (b) ceases to
apply to the trust.
(8) The trustee may withdraw
the confirmation of an intention under paragraph (5) (c) by giving to APRA
a notice of the withdrawal that is signed and dated by the trustee.
1.04AAAA Interdependency
relationships (Act s 10A)
(1) For paragraph 10A (3) (a) of the Act, the
following matters are to be taken into account in determining whether 2 persons
have an interdependency relationship, or had an interdependency relationship
immediately before the death of 1 of the persons:
(a) all of the circumstances of the relationship
between the persons, including (where relevant):
(i) the duration of the relationship;
and
(ii) whether or not a sexual
relationship exists; and
(iii) the ownership, use and acquisition
of property; and
(iv) the degree of mutual commitment to
a shared life; and
(v) the care and support of children;
and
(vi) the reputation and public aspects
of the relationship; and
(vii) the degree of emotional support;
and
(viii) the extent to which the
relationship is one of mere convenience; and
(ix) any evidence suggesting that the
parties intend the relationship to be permanent;
(b) the existence of a statutory declaration
signed by one of the persons to the effect that the person is, or (in the case
of a statutory declaration made after the end of the relationship) was, in an
interdependency relationship with the other person.
(2) For paragraph 10A (3) (b) of the Act, 2
persons have an interdependency relationship if:
(a) they satisfy the requirements of paragraphs
10A (1) (a) to (c) of the Act; and
(b) one or each of them provides the other with
support and care of a type and quality normally provided in a close personal
relationship, rather than by a mere friend or flatmate.
Examples of care normally provided in a close personal relationship
rather than by a friend or flatmate
1. Significant care provided for the
other person when he or she is unwell.
2. Significant care provided for the
other person when he or she is suffering emotionally.
(3) For paragraph 10A (3) (b) of the Act, 2
persons have an interdependency relationship if:
(a) they have a close personal relationship; and
(b) they do not satisfy the other requirements
set out in subsection 10A (1) of the Act; and
(c) the reason they do not satisfy the other
requirements is that they are temporarily living apart.
Example for paragraph (3) (c)
One of the persons is temporarily working overseas or is
in gaol.
(4) For paragraph 10A (3) (b) of the Act, 2
persons have an interdependency relationship if:
(a) they have a close personal relationship; and
(b) they do not satisfy the other requirements
set out in subsection 10A (1) of the Act; and
(c) the reason they do not satisfy the other
requirements is that either or both of them suffer from a disability.
(5) For paragraph 10A (3) (b) of the Act, 2
persons do not have an interdependency relationship if 1 of them provides
domestic support and personal care to the other:
(a) under an employment contract or a contract
for services; or
(b) on behalf of another person or organisation
such as a government agency, a body corporate or a benevolent or charitable
organisation.
1.04AAA Modified
meaning of member (Act s 15B) [see Note 2]
(1) This regulation applies if:
(a) a superannuation interest in a fund is
subject to a payment split, or a non‑member spouse interest has been
created under regulation 7A.03B; and
(b) the non‑member spouse in relation to
the interest was not a member of the fund immediately before the operative time
for the payment split.
(2) For the purposes of the
provisions of the Act set out in Table 1, the non‑member spouse is
to be treated as being a member of the fund in which the interest is held from
the later of:
(a) the operative time for the payment split;
and
(b) the time that the trustee receives the
agreement or order under which the payment split is effected.
Table 1
|
Item
|
Provision
|
|
1
|
subsection 17A, except subsection (5) (definition of
self managed superannuation fund)
|
|
2
|
section 65 (lending to members of regulated superannuation
fund prohibited)
|
|
3
|
Part 8 (in‑house asset rules applying to regulated
superannuation funds)
|
(3) For subsection 17A (5) of the Act, the non‑member
spouse is to be treated as being a member of the fund in which the interest is
held from the later of:
(a) the end of 6 months after the operative time for the
payment split; and
(b) the end of 6 months after the time that the trustee
receives the agreement or order under which the payment split is effected.
(4) For regulation 1.03A, the non‑member spouse is
to be treated as being a member of the fund in which the interest is held from
the operative time for the payment split.
(5) For subsection 17A (5) of the Act, a non‑member
spouse who became a member of a fund as a result of the creation of a non‑member
spouse interest under Division 7A.1A is not
treated as a member of the fund until the earlier of:
(a) 6 months after the operative time for the
payment split; and
(b) the time that the non‑member spouse’s
interest in the fund is confirmed under regulation 7A.03H or 7A.03I.
1.04A Specified
body or person (Act s 19)
For subsection 19 (4) of the Act, the
Commissioner of Taxation is specified.
1.04AA Self
managed superannuation funds — persons not taken to be employees (Act s
17A (8))
(1) For the purposes of paragraph 17A (8) (b)
of the Act, a class of persons is a specified class if it comprises persons
each of whom is, in relation to a member of a superannuation fund, an exempt
person mentioned in subregulation (2).
(2) A person is an exempt person in relation to a member
of a superannuation fund if:
(a) the person is an employer‑sponsor of
the fund; and
(b) the member is a director of the employer‑sponsor.
(3) For the purposes of paragraph 17A (8) (b) of the
Act, a class of persons is a specified class if it comprises persons each of
whom is a member of a superannuation fund in relation to which the following
circumstances exist:
(a) the person is the employer, but not a
relative, of a member of the fund (the employee);
(b) another member is the employer, and a
relative, of that employee.
Part 1A Annuities
and pensions
Division 1A.1
1.05 Meaning
of annuity (Act, s 10)
(1) A benefit that is provided by a life insurance
company or a registered organisation is taken to be an annuity for the purposes
of the Act if:
(a) it arises under a contract that:
(i) meets
the standards of subregulation (11A); and
(ii) does not
permit the capital supporting the annuity to be added to by way of contribution
or rollover after the annuity has commenced; and
(b) for a benefit
purchased on or after 3 August 1993 and before 1 July 2007 — it is
purchased with the whole or part of a rolled over amount within the meaning
given to that term by section 27A of the Tax Act; and
(c) for a benefit purchased on or after 1 July
2007 — it is purchased with the whole or part of:
(i) a roll‑over
superannuation benefit within the meaning of the 1997 Tax Act; or
(ii) a
directed termination payment within the meaning of the Income Tax
(Transitional Provisions) Act 1997; and
(d) in the case of a
contract to which paragraph (11A) (a) applies — the contract also meets
the standards of regulation 1.07D; and
(e) in the case of a
contract to which paragraph (11A) (b) applies — the contract also meets the
standards of regulation 1.07B.
(1A) A benefit that is
provided by a life insurance company or a registered organisation that
commenced to be paid before 20 September 2007 is taken to be an annuity
for the purposes of the Act if:
(a) it arises under a
contract that meets the standards of subregulation (2), (4), (6), (7), (8), (9)
or (10); and
(b) for a benefit
purchased on or after 3 August 1993 and before 1 July 2007 — it is
purchased with the whole or part of a rolled over amount within the meaning given
to that term by section 27A of the Tax Act; and
(c) for a benefit purchased on or after 1 July
2007 and before 20 September 2007 — it is purchased with the whole or part
of:
(i) a roll‑over
superannuation benefit within the meaning of the 1997 Tax Act; or
(ii) a
directed termination payment within the meaning of the Income Tax
(Transitional Provisions) Act 1997; and
(d) for a benefit that
arises under a contract that meets the standards of subregulation (9) and is
purchased by the primary beneficiary on or after 20 September 1998 —
the commencement day under the contract is the day when the benefit was
purchased; and
(e) for a benefit that
arises under a contract that meets the standards of subregulation (4) —
the contract also meets the standards of regulation 1.07A; and
(f) for a benefit that
arises under a contract that meets the standards of subregulation (2), (6), (7)
or (9) — the contract also meets the standards of regulation 1.07B; and
(g) for a benefit that arises under a contract
that meets the standards of subregulation (8):
(i) the benefit can be taken to
consist of two benefits:
(A) an
annuity that arises from that part of the contract that provides for payments
whose size is not fixed; and
(B) an
annuity that arises from that part of the contract that provides for payments
whose size in a year is fixed; and
(ii) the
contract meets the standards of regulation
1.07A in relation to the annuity mentioned in sub‑subparagraph (i) (A);
and
(iii) the
contract meets the standards of regulation 1.07B in relation to the annuity
mentioned in sub‑ subparagraph (i) (B); and
(h) for a benefit that
arises under a contract that meets the standards of subregulation (10), and has
a commencement day on or after 20 September 2004 — the contract also meets
the standards of regulation 1.07C.
(1B) A benefit provided by a life insurance company or
registered organisation that commenced to be paid on or after
20 September 2007 is taken to be an annuity for the purposes of the Act if:
(a) the benefit arises under a contract that
meets the standards of:
(i) subregulation 1.05 (9) or
(10); and
(ii) subregulation 1.05 (11A); and
(b) the benefit was purchased with a rollover
superannuation benefit that resulted from the commutation of:
(i) an annuity provided under a
contract that meets the standards of subregulation 1.05 (2), (9) or (10);
or
(ii) a pension provided under rules
that meet the standards of subregulation 1.06 (2), (7) or (8); or
(iii) a pension provided under terms
and conditions that meet the standards of subregulation 1.07 (3A) of the
RSA Regulations; and
(c) for a benefit that
arises under a contract that meet the standards of subregulation (9) — the
contract also meets the standards of regulation 1.07B; and
(d) for a benefit that
arises under a contract that meet the standards of subregulation (10) —
the contract also meets the standards of regulation 1.07C.
(2) A contract for the provision of a benefit (in this
subregulation called the annuity) meets the standards of this
subregulation if it ensures that:
(a) the annuity is paid at least annually
throughout the life of the primary beneficiary in accordance with paragraphs
(b) and (c) and, if there is a reversionary beneficiary:
(i) throughout the reversionary
beneficiary’s life; or
(ii) if he or she is a child of the
primary beneficiary or
of a former reversionary beneficiary under the annuity — at least until
his or her 16th birthday; or
(iii) if the person referred to in
subparagraph (ii) is a full‑time student at age 16 — at least until
the end of his or her full‑time studies or until his or her 25th birthday
(whichever occurs sooner); and
(b) the size of payments of benefit in a year is
fixed, allowing for variation only:
(i) as specified in the contract; or
(ii) to allow commutation to pay a
superannuation contributions surcharge; or
(iii) to allow an amount to be paid
under a payment split and reasonable fees in respect of the payment split to be
charged; and
(c) unless APRA otherwise approves, the sum
payable as benefit in each year to the primary beneficiary or to the
reversionary beneficiary, as the case may be, is:
(i) if CPIc is not less
than CPIp — not less than SPp; or
(ii) if
CPIc is less than CPIp — not less than:
where:
CPIc means the
quarterly CPI first published by the Australian Statistician for the second‑last
quarter before the day on which payment is to be made.
CPIp means the
quarterly CPI first published by the Australian Statistician for the same
quarter in the immediately preceding year.
SPp means the sum
payable in the immediately preceding year;
and
(d) the amount paid as the purchase price is
wholly converted into annuity income; and
(e) the annuity does not have a residual capital
value; and
(f) the annuity cannot be commuted except in any
of the following circumstances:
(i) the
annuity is not funded from the commutation of:
(A) an
annuity that meets the standards of this subregulation or subregulation (3),
(9) or (10); or
(B) a
pension that meets the standards of subregulation 1.06 (2), (3), (7) or (8); or
(C) a
pension that meets the standards of subregulation 1.07 (3A) of the RSA
Regulations;
and the
commutation is made within 6 months after the commencement day of the annuity;
(ii) the commutation is made to the
benefit of a reversionary beneficiary on the death of the primary beneficiary
and within one of the following periods after the commencement day of the
annuity:
(A) if the primary
beneficiary’s life expectancy on the commencement day, rounded up to the next
whole number, is a period less than 20 years — that period;
(B) in any other case —
20 years;
(iii) the superannuation
lump sum resulting from the commutation is transferred directly for the
purpose of purchasing another benefit provided under:
(A) a contract that meets
the standards of this subregulation or subregulation (3), (9) or (10); or
(B) rules that meet the
standards of subregulation 1.06 (2), (3), (7) or (8); or
(C) terms and conditions
that meet the standards of subregulation 1.07 (3A) of the RSA Regulations;
(iv) to
pay a superannuation contributions surcharge;
(v) to give effect to an entitlement of
a non‑member spouse under a payment split;
(vi) for the purpose of paying an
amount to give effect to a release authority under:
(A) section
292‑415 of the Income Tax Assessment Act 1997; or
(B) section
292‑80C of the Income Tax (Transitional Provisions) Act 1997;
in
respect of the primary beneficiary;
(vii) the annuity was commenced in
contravention of Part 6 and the commutation would result in an obligation
to pay an amount to the Commissioner of Taxation under subsection 20F (1)
of the Superannuation (Unclaimed Money and Lost Members) Act 1999; and
(g) if the annuity reverts or is commuted, it
does not have a reversionary component greater than 100% of the benefit that
was payable before the reversion or the commutation; and
(h) the annuity cannot be transferred to a
person other than a reversionary beneficiary on the death of the primary
beneficiary or of another reversionary beneficiary; and
(i) the capital value of the annuity, and the
income from it, cannot be used as security for a borrowing.
(3) For the purpose of
determining whether an annuity meets the standards in subregulation (2), it is
immaterial that:
(a) if the primary beneficiary dies within the
period used
for subparagraph (2) (f) (ii), a surviving reversionary beneficiary may obtain
a payment equal to the total payments that the primary beneficiary would have
received, if the primary beneficiary had not died, from the day of the death
until the end of the period; and
(b) if the primary beneficiary dies within the
period used for subparagraph (2) (f) (ii) and there is no surviving
reversionary beneficiary, an amount, not exceeding the difference between the
sum of the amounts paid to the primary beneficiary and the sum of the amounts
that would have been so payable in the period, is payable to the primary
beneficiary’s estate; and
(c) if the primary beneficiary dies within the
period used for subparagraph (2) (f) (ii) and there is a surviving reversionary
beneficiary who also dies within that period, there is payable to the
reversionary beneficiary’s estate an amount determined as described in
paragraph (b) as if that paragraph applied to the reversionary beneficiary.
(4) A contract for the provision of a benefit (in this
subregulation called the annuity):
(a) that does not meet the standards in
subregulation (2); and
(b) that does not fix the size of payments of
benefit in a year; and
(c) under which
the commencement day is on or after 22 December 1992;
meets the standards of this subregulation if the contract at least
ensures that:
(d) the standards in paragraphs (2) (h) and (i)
are met; and
(e) payments are made at least annually; and
(f) for an annuity that has a commencement day
on or after
22 December 1992 and before 1 January 2006 — the payments in a year
(excluding payments by way of commutation but including payments made under a
payment split) are not larger or smaller in total than, respectively, the
maximum and minimum limits calculated in accordance with Schedule 1A; and
(g) for an annuity that has a commencement day
on or after 1 January 2006 — the payments in a year (excluding
payments by way of commutation but including payments made under a payment
split) are not larger or smaller in total than the following:
(i) for payments made during the
period starting on 1 January 2006 and ending on 30 June 2006 — the
respective maximum and minimum limits for the year calculated in accordance
with 1 of the following Schedules:
(A) Schedule 1A;
(B) Schedule 1AAB;
(ii) for payments made on or after 1
July 2006 — the respective maximum and minimum limits for the year
calculated in accordance with Schedule 1AAB.
Note 22 December 1992 was the date of
Royal Assent to the Taxation Laws Amendment (Superannuation) Act 1992.
(5) For the purpose of determining whether an annuity
meets the standards in subregulation (4), it is immaterial:
(a) that:
(i) the commencement day of the
annuity occurs on or after 1 June in a financial year; and
(ii) the contract does not ensure that
payments in that financial year meet the standard in that subregulation for the
minimum amount; or
(b) that the contract does not ensure that the
payments in the year in which the annuity is to end meet the standard in that
subregulation for the minimum amount.
(6) A contract for the provision of a benefit (in this
subregulation called the annuity):
(a) that does not meet the standards of
subregulation (2); and
(b) that fixes the size of the payments of
benefit in a year, allowing for variation only as specified in the contract or
to allow payments to be made under a payment split; and
(c) under which the commencement day is on or
after 1 July 1994;
meets the standards of this subregulation if the contract at least
ensures that:
(d) the standards in paragraphs (2) (g), (h) and
(i) are met; and
(e) except in
relation to payments, by way of commutation, for superannuation contributions
surcharge, variation in payments from year to year does not exceed, in any
year, the average rate of increase of the CPI in the preceding 3 years;
and
(f) payments in accordance with paragraph (b)
are made at least annually; and
(g) the amount paid as the purchase price is
wholly converted into annuity income.
(7) A contract for the provision of a benefit (in this
subregulation called the annuity) that:
(a) does not meet the standards of subregulation
(2); and
(b) provides for payments whose size in a year is
fixed, allowing for variation only as specified in the contract; and
(c) provides for additional payments (in this
subregulation called bonus payments);
(d) the commencement day of which is on or after
1 July 1994;
meets the standards of this subregulation if it at least ensures
that:
(e) in respect of the fixed‑size
payments — the standards in subregulation (6) are met; and
(f) the fixed‑size payments amount to at
least 50% of:
(i) if the provider provides annuities
of the kind specified in subregulation (6) — the amount that would be
payable if the annuity were wholly of that kind; or
(ii) if the provider does not provide
annuities of the kind specified in subregulation (6) — the fixed‑size
payments are at least equal in amount to 50% of the interest payable on
Commonwealth bonds that have the same value as the purchase price of the
annuity and that most closely correspond in term to the term of the annuity;
and
(g) the amounts of the bonus payments (if any)
are reasonably proportional to the investment income from which the payments
purport to be derived; and
(h) the amount of a bonus payment (if any) is
notified in writing by the provider each year and is paid to the beneficiary in
the year next following (except when deferral of the payment would not result,
in any future year, in the rate of increase in size of the total payments for
the year exceeding the average rate of increase of the CPI in the preceding 3
years).
(8) A contract for the
provision of a benefit (in this subregulation called the annuity):
(a) that does not meet all the standards in any
other provision of this regulation; and
(b) under which the commencement day is on or
after 22 December 1992; and
(c) that provides for:
(i) payments whose size in a year is
fixed, allowing for variation only as specified in the contract; and
(ii) additional payments whose size is
not fixed, derived from the application of part of the purchase price to
investments by allocation of the annuity provider;
meets the standards of this subregulation if it at least ensures that:
(d) in respect of fixed‑size
payments — if the commencement day is on or after 1 July 1994, the
standards in subregulation (6) are met; and
(e) in respect of payments whose size is not
fixed — the standards in subregulation (4) are met.
Note 22 December 1992 was the date of
Royal Assent to the Taxation Laws Amendment (Superannuation) Act 1992.
(9) A contract for the provision of a benefit (in this
subregulation called the annuity) meets the standards of this
subregulation if the contract ensures that:
(a) for an annuity that has a commencement day
before 20 September 2004:
(i) if the life expectancy of the
primary beneficiary on the commencement day is less than 15 years — the
annuity is paid at least annually to the primary beneficiary or to a reversionary
beneficiary throughout a period equal to the primary beneficiary’s life
expectancy on the commencement day, rounded up, at the primary beneficiary’s
option, to the next whole number if the primary beneficiary’s life expectancy
does not consist of a whole number of years; or
(ii) if the life expectancy of the
primary beneficiary
on the commencement day is 15 years or more — the annuity is paid at least
annually to the
primary beneficiary or to a reversionary beneficiary throughout a period that
is not less than 15 years but not more than the primary beneficiary’s life
expectancy on the commencement day, rounded up, at the primary beneficiary’s
option, to the next whole number if the primary beneficiary’s life expectancy
does not consist of a whole number of years; and
(b) for an annuity that has a commencement day on
or after 20 September 2004:
(i) the annuity is paid at least
annually to the primary beneficiary or to a reversionary beneficiary throughout
a period equal to the primary beneficiary’s life expectancy on the commencement
day, rounded up to the next whole number if the primary beneficiary’s life
expectancy does not consist of a whole number of years; or
(ii) the annuity is paid at least
annually to the primary beneficiary or to a reversionary beneficiary throughout
a period equal to the primary beneficiary’s life expectancy mentioned in
subparagraph (i) calculated, at the option of the primary beneficiary, as if
the primary beneficiary were up to 5 years younger on the commencement day; or
(iia) if the annuity has a commencement
day on or after 1 January 2006 — the annuity is paid at least
annually to the primary beneficiary or reversionary beneficiary throughout a
period that is not less than the period available under subparagraph 1.05 (9)
(b) (i), and not more than the greater of the following periods:
(A) the maximum period
available under subparagraph 1.05 (9) (b) (ii);
(B) the period of years
equal to the number that is the difference between the age attained by the
primary beneficiary at his or her most recent birthday before the commencement
day, and 100; or
(iii) if:
(A) the annuity is an
annuity that reverts to a surviving spouse on the death of the primary
beneficiary; and
(B) the life expectancy of
the primary beneficiary’s spouse is greater than the life expectancy of the
primary beneficiary; and
(C) the primary beneficiary
has not chosen
to make an arrangement mentioned in subparagraph (i), (ii) or (iia) for the
annuity;
the annuity is paid at least annually
to the primary beneficiary or to a reversionary beneficiary throughout a period
equal to:
(D) the life expectancy of
the spouse on the commencement day; or
(E) the life expectancy of
the spouse calculated, at the option of the primary beneficiary, as if the
spouse were up to 5 years younger on the commencement day; or
(F) if the annuity has a
commencement day on
or after 1 January 2006 — a period that
is not less than the period available under sub‑subparagraph 1.05 (9) (b)
(iii) (D), and not more than the greater of the following periods:
(I) the maximum
period available under sub‑subparagraph 1.05 (9) (b) (iii) (E);
(II) the period
of years equal to the number that is the difference between the age attained by
the spouse at his or her most recent birthday before the commencement day, and
100;
at the option of the primary
beneficiary, and rounded up to the next whole number if the life expectancy of
the spouse, or the period, does not consist of a whole number of years; and
(c) the total
amount of the payment, or payments, to be made in the first year after the
commencement day (not taking commuted amounts into account) is fixed and that
payment, or the first of those payments, relates to the period commencing on
the day the benefit was purchased; and
(d) the total amount of the payments to be made
in a year other than the first year after the commencement day (not taking
commuted amounts into account) does not fall below the total amount of the
payments made in the immediately preceding year (the previous total),
and does not exceed the previous total:
(i) if CPIc is less than or
equal to 4% — by more than 5% of the previous total; or
(ii) if CPIc is more than
4% — by more than CPIc + 1%;
where:
CPIc is
the change (if any), expressed as a percentage, determined by comparing the
quarterly CPI first published by the Australian Statistician for the second‑last
quarter before the day on which the first of those payments is to be made and
the quarterly CPI first published by the Australian Statistician for the same
quarter in the immediately preceding year;
and
(e) the total amount of the payments to be made
in a year in accordance with paragraph (c) or (d) may be varied only:
(i) to allow commutation to pay a
superannuation contributions surcharge; or
(ii) to allow an amount to be paid
under a payment split and reasonable fees to be charged in respect of the
payment split; and
(f) the amount paid as the purchase price is
wholly converted into annuity income; and
(g) the annuity does not have a residual capital
value; and
(h) the annuity
cannot be commuted except in any of the following circumstances:
(i) the
annuity is not funded from the commutation of:
(A) an
annuity that meets the standards of this subregulation or subregulation (2),
(3) or (10); or
(B) a
pension that meets the standards of subregulation 1.06 (2), (3), (7) or
(8); or
(C) a
pension that meets the standards of subregulation 1.07 (3A) of the RSA
Regulations;
and the
commutation is made within 6 months after the commencement day of the annuity;
(ii) subject to subparagraph (iv), by
payment, on the death of the primary beneficiary, to the benefit of a
reversionary beneficiary or, if there is no reversionary beneficiary, to the
estate of the primary beneficiary;
(iii) subject to subparagraph (iv), by
payment, on the death of a reversionary beneficiary, to the benefit of another
reversionary beneficiary or, if there is no other reversionary beneficiary, to
the estate of the reversionary beneficiary;
(iv) for subparagraphs (ii) and (iii), if
the primary beneficiary has opted, under subparagraph (b) (iii), for a period
worked out in relation to the life expectancy or age of the primary
beneficiary’s spouse — the annuity cannot be commuted until the death of
both the primary beneficiary and the spouse;
(v) the superannuation
lump sum resulting from the commutation is transferred directly to the
purchase of another benefit that is:
(A) an annuity provided
under a contract that meets the standards of subregulation (2), (3) or
(10) or this subregulation; or
(B) a pension that is
provided under rules that meet the standards of subregulation 1.06 (2),
(3), (7) or (8); or
(C) a
pension that is provided under terms and conditions that meet the standards of
subregulation 1.07 (3A) of the RSA Regulations;
(vi) to pay a superannuation
contributions surcharge;
(vii) to give effect to an entitlement
of a non‑member spouse under a payment split;
(viii) for the purpose of paying an
amount to give effect to a release authority under:
(A) section
292‑415 of the Income Tax Assessment Act 1997; or
(B) section
292‑80C of the Income Tax (Transitional Provisions) Act 1997;
in
respect of the primary beneficiary;
(ix) the annuity was commenced in
contravention of Part 6 and the commutation would result in an obligation
to pay an amount to the Commissioner of Taxation under subsection 20F (1)
of the Superannuation (Unclaimed Money and Lost Members) Act 1999; and
(i) if the annuity reverts, it does not have a
reversionary component greater than 100% of the benefit that was payable before
the reversion; and
(j) if the annuity is commuted, the commuted
amount cannot exceed the benefit that was payable immediately before the
commutation; and
(k) the annuity cannot be transferred to a person
except:
(i) on the death of the primary
beneficiary, to a reversionary beneficiary or, if there is no reversionary
beneficiary, to the estate of the primary beneficiary; or
(ii) on the death of a reversionary
beneficiary, to another reversionary beneficiary or, if there is no other
reversionary beneficiary, to the estate of the reversionary beneficiary; and
(l) the capital value of the annuity, and the
income from it, cannot be used as security for a borrowing.
(10) A contract for the provision of a benefit (market
linked annuity) meets the standards of this subregulation if the
contract ensures that:
(a) the market linked annuity:
(i) is paid at least annually to the
primary beneficiary or to a reversionary beneficiary throughout a period equal
to the primary beneficiary’s life expectancy on the commencement day of the
annuity, rounded up to the next whole number if the primary beneficiary’s life
expectancy does not consist of a whole number of years; or
(ii) is paid at least annually to the
primary beneficiary or to a reversionary beneficiary throughout a period equal
to the primary beneficiary’s life expectancy mentioned in subparagraph (i)
calculated, at the option of the primary beneficiary, as if the primary
beneficiary were up to 5 years younger on the commencement day; or
(iia) if
the annuity has a commencement day on or after 1 January 2006 — the
annuity is paid at least annually to the primary beneficiary or reversionary
beneficiary throughout a period that is not less than the period available under
subparagraph 1.05 (10) (a) (i), and not more than the greater of the following
periods:
(A) the maximum period
available under subparagraph 1.05 (10) (a) (ii);
(B) the period of years
equal to the number that is the difference between the age attained by the
primary beneficiary at his or her most recent birthday before the commencement
day, and 100; or
(iii) if:
(A) the annuity is an
annuity that reverts to a surviving spouse on the death of the primary
beneficiary; and
(B) the life expectancy of the
primary beneficiary’s spouse is greater than the life expectancy of the primary
beneficiary; and
(C) the primary beneficiary
has not chosen
to make an arrangement mentioned in subparagraph (i), (ii) or (iia) for the
annuity;
the annuity is paid at least
annually to the primary beneficiary or to a reversionary beneficiary throughout
a period equal to:
(D) the life expectancy of
the spouse on the commencement day; or
(E) the life expectancy of
the spouse calculated, at the option of the primary beneficiary, as if the
spouse were up to 5 years younger on the commencement day; or
(F) if the annuity has a
commencement day on or after 1 January 2006 — a period that is not less
than the period available under sub‑subparagraph 1.05 (10) (a) (iii) (D),
and not more than the greater of the following periods:
(A) the maximum
period available under sub‑subparagraph 1.05 (10) (a) (iii) (E);
(B) the period
of years equal to the number that is the difference between the age attained by
the spouse at his or her most recent birthday before the commencement day, and
100;
at the option of the primary
beneficiary, and rounded up to the next whole number if the life expectancy of
the spouse, or the period, does not consist of a whole number of years; and
(b) the total amount of the payments to be made
in a year (excluding payments by way of commutation but including payments made
under a payment split) is determined in accordance with Schedule 6; and
(c) the market linked annuity does not have a
residual capital value; and
(d) the market linked annuity cannot be commuted
except in any of the following circumstances:
(i) the annuity is not funded from
the commutation of:
(A) another annuity that is
provided under a contract that meets the standards of subregulation (2), (3) or
(9) or this subregulation; or
(B) a pension that is
provided under rules that meet the standards of subregulation 1.06 (2), (3),
(7) or (8); or
(C) a pension that is
provided under terms and conditions that meet the standards of subregulation
1.07 (3A) of the RSA Regulations;
and the commutation is made within
6 months after the commencement day of the annuity;
(ii) subject to subparagraph (iii), on
the death of the primary beneficiary or reversionary beneficiary, by payment of:
(A) a lump sum or a new
annuity to one or more dependants of either the primary beneficiary or
reversionary beneficiary; or
(B) a lump sum to the legal
personal representative of either the primary beneficiary or reversionary
beneficiary; or
(C) if, after making
reasonable enquiries, the provider of the annuity is unable to find a person
mentioned in sub‑subparagraph (A) or (B) — a lump sum to another
individual;
(iii) for subparagraph (ii), if the
primary beneficiary has opted, under subparagraph (a) (iii), for a period
worked out in relation to the life expectancy or age of the primary
beneficiary’s spouse — the market linked annuity cannot be commuted until
the death of both the primary beneficiary and the spouse;
(iv) the superannuation
lump sum resulting from the commutation is transferred directly to the
purchase of another benefit that is:
(A) an annuity provided
under a contract that meets the standards of subregulation 1.05 (2), (3)
or (9) or this subregulation; or
(B) a pension that is
provided under rules that meet the standards of subregulation 1.06 (2), (3), (7)
or (8); or
(C) a pension that is
provided under terms and conditions that meet the standards of subregulation
1.07 (3A) of the RSA Regulations;
(v) to pay a superannuation
contributions surcharge;
(vi) to give effect to an entitlement of
a non‑member spouse under a payment split;
(vii) for the purpose of paying an
amount to give effect to a release authority under:
(A) section
292‑415 of the Income Tax Assessment Act 1997; or
(B) section
292‑80C of the Income Tax (Transitional Provisions) Act 1997;
in
respect of the primary beneficiary;
(viii) the annuity was commenced in
contravention of Part 6 and the commutation would result in an obligation
to pay an amount to the Commissioner of Taxation under subsection 20F (1)
of the Superannuation (Unclaimed Money and Lost Members) Act 1999; and
(e) if the market linked annuity reverts, it
does not have a reversionary component greater than 100% of the account balance
immediately before the reversion; and
(f) if the market linked annuity is commuted,
the commutation amount cannot exceed the account balance immediately before the
commutation; and
(g) the market linked annuity can be transferred
only:
(i) on the death of the primary
beneficiary:
(A) to 1 of the dependants
of the primary beneficiary; or
(B) to the legal personal
representative of the primary beneficiary; or
(ii) on the death of the reversionary
beneficiary:
(A) to 1 of the dependants
of the reversionary beneficiary; or
(B) to the legal personal
representative of the reversionary beneficiary; and
(h) the capital value of the market linked
annuity, and the income from it, cannot be used as security for a borrowing.
(11) A contract mentioned in subregulation (10) is not prevented
from meeting the standards of that subregulation by reason only that the
contract provides that, if the commencement day of the annuity is on or after 1
June in a financial year, no payment is required to be made for that financial
year.
(11A) A contract for the provision of a benefit (the
annuity) meets the standards of this subregulation if the contract
ensures that payment of the annuity is made at least annually, and also ensures
that:
(a) for an annuity in
relation to which there is an account balance attributable to the annuitant —
the total of payments in any year (including under a payment split) is at least
the amount calculated under clause 1 of Schedule 7; and
(b) for an annuity that is not described in
paragraph (a):
(i) both of the following apply:
(A) the
contract does not provide for a residual capital value, commutation value or
withdrawal benefit greater than 100% of the purchase price of the annuity;
(B) the
total of payments in any year (including under a payment split) is at least the amount calculated under clause 2 of
Schedule 7; or
(ii) each of the following applies:
(A) the
annuity is payable throughout the life of the beneficiary (primary or
reversionary), or for a fixed term of years that is no greater than the difference
between the primary beneficiary’s age on the commencement day and age 100;
(B) the
amount paid as the purchase price is wholly converted into annuity payments;
(C) there
is no arrangement for an amount (or a percentage of the purchase price) prescribed
by the contract to be returned to the recipient when the annuity ends;
(D) the
total of payments from the annuity in the first year (including under a payment
split) is at least the amount calculated under clause 2 of Schedule 7;
(E) the
total of payments from the annuity in a subsequent year cannot vary from the
total of payments in the previous year unless the variation is as a result of
an indexation arrangement or the transfer of the annuity to another person;
(F) if
the annuity is commuted, the commutation amount cannot exceed the benefit that
was payable immediately before the commutation; or
(iii) the
standards of subregulation (2) are met; and
(c) the annuity is
transferable to another person only on the death of the beneficiary (primary or
reversionary, as the case may be); and
(d) the capital value
of the annuity and the income from it cannot be used as a security for a
borrowing.
(11B) A contract for the provision
of a benefit does not meet the standards of any of subregulations (2) to (11A)
if, in relation to the death of the annuity recipient on or after 1 July 2007,
the annuity is transferred or paid to a person
who would not be eligible to be paid a benefit in the form of an annuity under
subregulation 6.21 (2A) or (2B).
(12) Despite regulation 9 of the Income Tax Regulations
1936, for an annuity that has a commencement day on or after 20 September
2004 and on or before 31 December 2004, one of the following life tables are to
be used in ascertaining the life expectancy of a person under this regulation:
(a) the most recently published Australian Life
Tables;
(b) the 1995‑97 Australian Life Tables.
(13) In this regulation:
indexation arrangement,
in relation to an annuity, means an arrangement specified in the contract for
the provision of the annuity that:
(a) results in the total amount of annuity
payments in each year:
(i) increasing by the same percentage
factor; or
(ii) being adjusted in line with
movements in the Consumer Price Index; or
(iii) being adjusted in line with
movements in an index of average weekly earnings published by the Australian
Statistician; or
(iv) being adjusted in accordance with
subparagraph (ii) or (iii) but with an increase capped at a maximum level; and
(b) ensures that, unless APRA otherwise approves,
an adjustment is made at least annually to the amount of the annuity payments.
1.06 Meaning
of pension (Act, s 10)
(1) A benefit is taken to be a pension for the purposes
of the Act if:
(a) it is provided under rules of a
superannuation fund that:
(i) meet the
standards of subregulation (9A); and
(ii) do not
permit the capital supporting the pension to be added to by way of contribution
or rollover after the pension has commenced; and
(b) in the case of
rules to which paragraph (9A) (a) applies — the rules also meet the
standards of regulation 1.07D; and
(c) in the case of
rules to which paragraph (9A) (b) applies — the rules also meet the
standards of regulation 1.07B.
(1A) A benefit that commenced to be paid before 20
September 2007 is taken to be a pension for the purposes of the Act if:
(a) it is provided
under rules of a superannuation fund that meet the standards of subregulation
(2), (4), (6), (7) or (8); and
(b) where the primary
beneficiary became entitled to the benefit on or after 20 September 1998 under
rules of a superannuation fund that meet the standards of subregulation (7) —
those rules provide that the commencement day is the day when the primary
beneficiary became entitled to the pension; and
(c) for a benefit that
is provided under rules of a superannuation fund that meet the standards of
subregulation (4) — the rules also meet the standards of regulation 1.07A;
and
(d) for a benefit that
is provided under rules of a superannuation fund that meet the standards of
subregulation (2), (6) or (7) — the rules also meet the standards of
regulation 1.07B; and
(e) for a benefit that
is provided under rules of a superannuation fund that meet the standards of
subregulation (8), and has a commencement day on or after 20 September 2004 —
the rules also meet the standards of regulation 1.07C.
(1B) A benefit that
commenced to be paid on or after 20 September 2007 is taken to be a pension for
the purposes of the Act if:
(a) the benefit arises under rules of a superannuation fund that meet the
standards of:
(i) subregulation 1.06 (7) or
(8); and
(ii) subregulation 1.06 (9A); and
(b) the benefit was purchased with a rollover
superannuation benefit that resulted from the commutation of:
(i) an annuity provided under a
contract that meets the standards of subregulation 1.05 (2), (9) or (10);
or
(ii) a pension provided under rules
that meet the standards of subregulation 1.06 (2), (7) or (8); or
(iii) a pension provided under terms
and conditions that meet the standards of subregulation 1.07 (3A) of the
RSA Regulations; and
(c) for a benefit that
arises under rules that meet the standards of subregulation (7) — the rules
also meet the standards of regulation 1.07B; and
(d) for a benefit that
arises under rules that meet the standards of subregulation (8) — the rules
also meet the standards of regulation 1.07C.
(2) Rules meet the standards of this subregulation if
they ensure that:
(a) the pension is paid at least annually
throughout the life of the primary beneficiary in accordance with paragraphs
(b) and (c) and, if there is a reversionary beneficiary:
(i) throughout the reversionary
beneficiary’s life; or
(ii) if he or she is a child of the
primary beneficiary or of a former reversionary beneficiary under the
pension — at least until his or her 16th birthday; or
(iii) if the person referred to in
subparagraph (ii) is a full‑time student at age 16 — at least until
the end of his or her full‑time studies or until his or her 25th birthday
(whichever occurs sooner); and
(b) the size of payments of benefit in a year is
fixed, allowing for variation only:
(i) as specified in the governing
rules; or
(ii) to allow commutation to pay a
superannuation contributions surcharge; or
(iii) to allow an amount to be paid
under a payment split and reasonable fees in respect of the payment split to be
charged; and
(c) unless the Regulator otherwise approves, the
sum payable as benefit in each year to the primary beneficiary or to the
reversionary beneficiary, as the case may be, is:
(i) if CPIc is not less
than CPIp — not less than SPp; or
(ii) if CPIc is less than
CPIp — not less than:
where:
CPIc
means the quarterly CPI first published by the Australian Statistician for the
second‑last quarter before the day on which payment is to be made.
CPIp
means the quarterly CPI first published by the Australian Statistician for the
same quarter in the immediately preceding year.
SPp
means the sum payable in the immediately preceding year;
and
(d) the pension does not have a residual capital
value; and
(e) the pension cannot be commuted except in any
of the following circumstances:
(i) the pension
is not funded from the commutation of:
(A) an
annuity that meets the standards of subregulation 1.05 (2), (3), (9) or (10);
or
(B) a
pension that meets the standards of this subregulation or subregulation (3),
(7) or (8); or
(C) a
pension that meets the standards of subregulation 1.07 (3A) of the RSA
Regulations;
and the
commutation is made within 6 months after the commencement day of the pension;
(ii) the
commutation is made to the benefit of a reversionary beneficiary on the death
of the primary beneficiary and within one of the following periods after the commencement
day of the pension:
(A) if the primary beneficiary’s
life expectancy on the commencement day, rounded up to the next whole number,
is a period less than 20 years — that period;
(B) in any other case —
20 years;
(iii) the superannuation
lump sum resulting from the commutation is transferred directly for the
purpose of purchasing another benefit provided under:
(A) rules that meet the
standards of this subregulation or subregulation (3), (7) or (8); or
(B) a contract that meets
the standards of subregulation 1.05 (2), (3), (9) or (10); or
(C) terms and conditions
that meet the standards of subregulation 1.07 (3A) of the RSA Regulations;
(iv) to pay a superannuation
contributions surcharge;
(v) to give effect to an entitlement of
a non‑member spouse under a payment split;
(vi) for the purpose of paying an
amount to give effect to a release authority under:
(A) section
292‑415 of the Income Tax Assessment Act 1997; or
(B) section
292‑80C of the Income Tax (Transitional Provisions) Act 1997;
in
respect of the primary beneficiary;
(vii) the pension was commenced in
contravention of Part 6 and the commutation would result in an obligation
to pay an amount to the Commissioner of Taxation under subsection 20F (1)
of the Superannuation (Unclaimed Money and Lost Members) Act 1999; and
(f) if the pension reverts or is commuted, it
does not have a reversionary component greater than 100% of the benefit that
was payable before the reversion or the commutation; and
(g) the pension is not able to be transferred to
a person other than a reversionary beneficiary on the death of the primary
beneficiary or of another reversionary beneficiary; and
(h) the capital value of the pension and the
income from it, cannot be used as security for a borrowing.
(3) For the purpose of determining whether rules meet
the standards in subregulation (2), it is immaterial that:
(a) if the primary beneficiary dies within the
period used
for subparagraph (2) (e) (ii), a surviving reversionary beneficiary may obtain
a payment equal to the total payments that the primary beneficiary would have
received, if the primary beneficiary had not died, from the day of the death
until the end of the period; and
(b) if the primary beneficiary dies within the
period used
for subparagraph (2) (e) (ii) and there is no surviving reversionary beneficiary,
an amount, not exceeding the difference between the sum of the amounts paid to
the primary beneficiary and the sum of the amounts that would have been so
payable in the period, is payable to the primary beneficiary’s estate; and
(c) if the primary beneficiary dies within the
period used
for subparagraph (2) (e) (ii) and there is a surviving reversionary beneficiary
who also dies within that period, there is payable to the reversionary
beneficiary’s estate an amount determined as described in paragraph (b) as if
that paragraph applied to the reversionary beneficiary.
(4) Rules:
(a) that do not meet the standards in
subregulation (2); and
(b) that do not fix the size of payments of
benefit in a year; and
meet the standards of this subregulation if they at least ensure
that:
(c) the standards in paragraphs (2) (g) and (h)
are met; and
(d) payments are made at least annually; and
(e) for a pension that has a commencement day on
or after
22 December 1992 and before 1 January 2006 — the payments in a year
(excluding payments by way of commutation but including payments made under a
payment split) are not larger or smaller in total than, respectively, the
maximum and minimum limits calculated in accordance with Schedule 1A; and
(f) for a pension that has a commencement day on
or after 1 January 2006 — the payments in a year (excluding payments
by way of commutation but including payments made under a payment split) are
not larger or smaller in total than the following:
(i) for payments made during the
period starting on 1 January 2006 and ending on 30 June 2006 — the
respective maximum and minimum limits for the year calculated in accordance
with 1 of the following Schedules:
(A) Schedule 1A;
(B) Schedule 1AAB;
(ii) for payments made on or after 1
July 2006 — the respective maximum and minimum limits for the year
calculated in accordance with Schedule 1AAB.
Note 22 December 1992 was the date of
Royal Assent to the Taxation Laws Amendment (Superannuation) Act 1992.
(5) For the purpose of determining whether rules meet
the standards in subregulation (4), it is immaterial:
(a) that:
(i) the commencement day of the
pension occurs on or after 1 June in a financial year; and
(ii) the rules do not provide for the
payment of an amount in that financial year that meets the standard for the
minimum amount in that subregulation; or
(b) that the rules do not ensure that the
payments in the year in which the pension is to end meet the standard for the
minimum amount in that subregulation.
(6) Rules:
(a) that do not meet the standards in
subregulation (2); and
(b) that provide that the size of the payments of
benefit in a year is fixed, allowing for variation only as specified in the
rules or to allow payments to be made under a payment split; and
(c) under which the commencement day is on or
after 1 July 1994;
meet the standards in this subregulation if they at least ensure
that:
(d) the standards in paragraphs (2) (f), (g) and
(h) are met; and
(e) except in relation to payments, by way of
commutation, for superannuation contributions surcharge, variation in payments
from year to year does not exceed, in any year, the average rate of increase of
the CPI in the preceding 3 years; and
(f) payments in accordance with the contracted
size are made at least annually; and
(g) if, under the rules, the pension can be
commuted — except if conversion is in relation to a commutation to pay a
superannuation contributions surcharge, the conversion to a lump sum is limited
to a sum that is not greater than the sum determined by applying the
appropriate pension valuation factor under Schedule 1B to the pension as if the
commencement day were the day on which the commutation occurs.
(7) Rules meet the
standards of this subregulation if the rules ensure that:
(a) for a pension
that has a commencement day before 20 September 2004:
(i) if the life expectancy of the
primary beneficiary on the commencement day is less than 15 years — the
pension is paid at least annually to the primary beneficiary or to a
reversionary beneficiary throughout a period equal to the primary beneficiary’s
life expectancy on the commencement day, rounded up, at the primary
beneficiary’s option, to the next whole number if the primary beneficiary’s
life expectancy does not consist of a whole number of years; or
(ii) if the life expectancy of the
primary beneficiary on the commencement day is 15 years or more — the
pension is paid at least annually to the primary beneficiary or to a
reversionary beneficiary throughout a period that is not less than 15 years but
not more than the primary beneficiary’s life expectancy on the commencement day,
rounded up, at the primary beneficiary’s option, to the next whole number if
the primary beneficiary’s life expectancy does not consist of a whole number of
years; and
(b) for a pension that has a commencement day on
or after 20 September 2004:
(i) the pension is paid at least
annually to the primary beneficiary or to a reversionary beneficiary throughout
a period equal to the primary beneficiary’s life expectancy on the commencement
day, rounded up to the next whole number if the primary beneficiary’s life
expectancy does not consist of a whole number of years; or
(ii) the pension is paid at least
annually to the primary beneficiary or to a reversionary beneficiary throughout
a period equal to the primary beneficiary’s life expectancy mentioned in
subparagraph (i) calculated, at the option of the primary beneficiary, as if
the primary beneficiary were up to 5 years younger on the commencement day; or
(iia) if the pension has a commencement
day on or after 1 January 2006 — the pension is paid at least
annually to the primary beneficiary or reversionary beneficiary throughout a
period that is not less than the period available under subparagraph 1.06 (7)
(b) (i), and not more than the greater of the following periods:
(A) the maximum period
available under subparagraph 1.06 (7) (b) (ii);
(B) the period of years
equal to the number that is the difference between the age attained by the
primary beneficiary at his or her most recent birthday before the commencement
day, and 100; or
(iii) if:
(A) the pension is a pension
that reverts to a surviving spouse on the death of the primary beneficiary; and
(B) the life expectancy of
the primary beneficiary’s spouse is greater than the life expectancy of the
primary beneficiary; and
(C) the primary beneficiary
has not chosen to make an arrangement mentioned in subparagraph (i), (ii) or
(iia) for the pension;
the pension is paid at least
annually to the primary beneficiary or to a reversionary beneficiary throughout
a period equal to:
(D) the life expectancy of
the spouse on the commencement day; or
(E) the
life expectancy of the spouse calculated, at the option of the primary
beneficiary, as if the spouse were up to 5 years younger on the commencement day;
or
(F) if
the pension has a commencement day on or after 1 January 2006 — a period
that is not less than the period available under sub‑subparagraph 1.06
(7) (b) (iii) (D), and not more than the greater of the following periods:
(I) the maximum
period available under sub‑subparagraph 1.06 (7) (b) (iii) (E);
(II) the period
of years equal to the number that is the difference between the age attained by
the spouse at his or her most recent birthday before the commencement day, and
100;
at the option of the primary
beneficiary, and rounded up to the next whole number if the life expectancy of
the spouse, or the period, does not consist of a whole number of years; and
(c) the total amount of the payment, or payments,
to be made in the first year after the commencement day (not taking commuted
amounts into account) is fixed and that payment, or the first of those
payments, relates to the period commencing on the day the primary beneficiary
became entitled to the pension; and
(d) the total amount of the payments to be made
in a year other than the first year after the commencement day (not taking
commuted amounts into account) does not fall below the total amount of the
payments made in the immediately preceding year (the previous total),
and does not exceed the previous total:
(i) if CPIc is less than or
equal to 4% — by more than 5% of the previous total; or
(ii) if CPIc is more than
4% — by more than CPIc + 1%;
where:
CPIc is
the change (if any), expressed as a percentage, determined by comparing the
quarterly CPI first published by the Australian Statistician for the second‑last
quarter before the day on which the first of those payments is to be made and
the quarterly CPI first published by the Australian Statistician for the same
quarter in the immediately preceding year;
and
(e) the total amount of the payments to be made
in a year in accordance with paragraph (c) or (d) may be varied only:
(i) to allow commutation to pay a
superannuation contributions surcharge; or
(ii) to allow an amount to be paid
under a payment split and reasonable fees in respect of the payment split to be
charged; and
(f) the pension does not have a residual capital
value; and
(g) the pension cannot be commuted except in any
of the following circumstances:
(i) the pension
is not funded from the commutation of:
(A) an
annuity that meets the standards of subregulation 1.05 (2), (3), (9) or
(10); or
(B) a
pension that meets the standards of this subregulation or subregulation (2),
(3) or (8); or
(C) a
pension that meets the standards of subregulation 1.07 (3A) of the RSA
Regulations;
and the
commutation is made within 6 months after the commencement day of the pension;
(ii) subject to subparagraph (iv), by
payment, on the death of the primary beneficiary, to the benefit of a
reversionary beneficiary or, if there is no reversionary beneficiary, to the
estate of the primary beneficiary;
(iii) subject
to subparagraph (iv), by payment, on the death of a reversionary beneficiary,
to the benefit of another reversionary beneficiary, or, if there is no other
reversionary beneficiary, to the estate of the reversionary beneficiary;
(iv) for subparagraphs (ii) and (iii),
if the primary beneficiary has opted, under subparagraph (b) (iii), for a
period worked out in relation to the life expectancy or age of the primary
beneficiary’s spouse — the pension cannot be commuted until the death of
both the primary beneficiary and the spouse;
(v) the superannuation
lump sum resulting from the commutation is transferred directly to the
purchase of another benefit that is:
(A) an annuity provided
under a contract that meets the standards of subregulation (2), (3) (9) or
(10); or
(B) a pension that is
provided under rules that meet the standards of subregulation 1.06 (2),
(3) or (8) or this subregulation; or
(C) a pension that is
provided under terms and conditions that meet the standards of subregulation
1.07 (3A) of the RSA Regulations;
(vi) to pay a superannuation
contributions surcharge;
(vii) to give effect to an entitlement
of a non‑member spouse under a payment split;
(viii) for the purpose of paying an
amount to give effect to a release authority under:
(A) section
292‑415 of the Income Tax Assessment Act 1997; or
(B) section
292‑80C of the Income Tax (Transitional Provisions) Act 1997;
in
respect of the primary beneficiary;
(ix) the pension was commenced in
contravention of Part 6 and the commutation would result in an obligation
to pay an amount to the Commissioner of Taxation under subsection 20F (1)
of the Superannuation (Unclaimed Money and Lost Members) Act 1999; and
(h) if the pension reverts, it does not have a
reversionary component greater than 100% of the benefit that was payable before
the reversion; and
(i) if the pension is commuted, the commuted
amount cannot exceed the benefit that was payable immediately before the
commutation; and
(j) the pension cannot be transferred to a
person except:
(i) on the death of the primary
beneficiary, to a reversionary beneficiary or, if there is no reversionary
beneficiary, to the estate of the primary beneficiary; or
(ii) on the death of a reversionary
beneficiary, to another reversionary beneficiary or, if there is no other
reversionary beneficiary, to the estate of the reversionary beneficiary; and
(k) the capital value of the pension, and the
income from it, cannot be used as security for a borrowing.
(8) Rules that provide a benefit (the market
linked pension) meet the standards of this subregulation if the rules
ensure that:
(a) the market linked pension:
(i) is paid at least annually to the
primary beneficiary or to a reversionary beneficiary throughout a period equal
to the primary beneficiary’s life expectancy on the commencement day of the
pension, rounded up to the next whole number if the primary beneficiary’s life
expectancy does not consist of a whole number of years; or
(ii) is paid at least annually to the
primary beneficiary or to a reversionary beneficiary throughout a period equal
to the primary beneficiary’s life expectancy mentioned in subparagraph (i)
calculated, at the option of the primary beneficiary, as if the primary
beneficiary were up to 5 years younger on the commencement day; or
(iia) if
the pension has a commencement day on or after 1 January 2006 — the
pension is paid at least annually to the primary beneficiary or reversionary
beneficiary throughout a period that is not less than the period available
under subparagraph 1.06 (8) (a) (i), and not more than the greater of the
following periods:
(A) the maximum period
available under subparagraph 1.06 (8) (a) (ii);
(B) the period of years
equal to the number that is the difference between the age attained by the
primary beneficiary at his or her most recent birthday before the commencement
day, and 100; or
(iii) if:
(A) the pension is a pension
that reverts to a surviving spouse on the death of the primary beneficiary; and
(B) the life expectancy of
the primary beneficiary’s spouse is greater than the life expectancy of the
primary beneficiary; and
(C) the primary beneficiary
has not chosen to make an arrangement mentioned in subparagraph (i), (ii) or
(iia) for the pension;
the pension is paid at least
annually to the primary beneficiary or to a reversionary beneficiary throughout
a period equal to:
(D) the life expectancy of
the spouse on the commencement day; or
(E) the life expectancy of
the spouse calculated, at the option of the primary beneficiary, as if the
spouse were up to 5 years younger on the commencement day; or
(F) if the pension has a
commencement day on or after 1 January 2006 — a period that is not less
than the period available under sub‑subparagraph 1.06 (8) (a) (iii) (D),
and not more than the greater of the following periods:
(I) the maximum
period available under sub‑subparagraph 1.06 (8) (a) (iii) (E);
(II) the period
of years equal to the number that is the difference between the age attained by
the spouse at his or her most recent birthday before the commencement day, and
100;
at the option of the primary
beneficiary, and rounded up to the next whole number if the life expectancy of
the spouse, or the period, does not consist of a whole number of years; and
(b) the total amount of the payments to be made
in a year (excluding payments by way of commutation but including payments made
under a payment split) is determined in accordance with Schedule 6; and
(c) the market linked pension does not have a
residual capital value; and
(d) the market linked pension cannot be commuted
except in any of the following circumstances:
(i) the pension is not funded from
the commutation of:
(A) an annuity that is
provided under a contract that meets the standards of subregulation 1.05 (2),
(3), (9) or (10); or
(B) another pension that is
provided under rules that meet the standards of subregulation (2), (3) or
(7) or this subregulation; or
(C) another pension that is
provided under terms and conditions that meet the standards of subregulation
1.07 (3A) of the RSA Regulations;
and the commutation is made within
6 months after the commencement day of the pension;
(ii) subject to subparagraph (iii), on
the death of the primary beneficiary or reversionary beneficiary, by payment
of:
(A) a lump sum or a new
pension to one or more dependants of either the primary beneficiary or reversionary
beneficiary; or
(B) a lump sum to the legal
personal representative of either the primary beneficiary or reversionary
beneficiary; or
(C) if, after making
reasonable enquiries, the provider of the pension is unable to find a person
mentioned in sub‑subparagraph (A) or (B) — a lump sum to another individual;
(iii) for subparagraph (ii), if the
primary beneficiary has opted, under subparagraph (a) (iii), for a period
worked out in relation to the life expectancy or age of the primary beneficiary’s
spouse — the market linked pension cannot be commuted until the death of
both the primary beneficiary and the spouse;
(iv) the superannuation
lump sum resulting from the commutation is transferred directly to the
purchase of another benefit that is:
(A) an annuity provided
under a contract that meets the standards of subregulation 1.05 (2), (3), (9)
or (10); or
(B) a pension that is
provided under rules that meet the standards of this subregulation, or subregulation
1.06 (2), (3) or (7); or
(C) a pension that is
provided under terms and conditions that meet the standards of subregulation
1.07 (3A) of the RSA Regulations;
(v) to pay a superannuation
contributions surcharge;
(vi) to give effect to an entitlement of
a non‑member spouse under a payment split;
(vii) for the purpose of paying an
amount to give effect to a release authority under:
(A) section
292‑415 of the Income Tax Assessment Act 1997; or
(B) section
292‑80C of the Income Tax (Transitional Provisions) Act 1997;
in
respect of the primary beneficiary;
(viii) the pension was commenced in
contravention of Part 6 and the commutation would result in an obligation
to pay an amount to the Commissioner of Taxation under subsection 20F (1)
of the Superannuation (Unclaimed Money and Lost Members) Act 1999; and
(e) if the market linked pension reverts —
it does not have a reversionary component greater than 100% of the account
balance immediately before the reversion; and
(f) if the market linked pension is
commuted — the commutation amount cannot exceed the account balance
immediately before the commutation; and
(g) the market linked pension can be transferred
only:
(i) on the death of the primary
beneficiary:
(A) to 1 of the dependants
of the primary beneficiary; or
(B) to the legal personal
representative of the primary beneficiary; or
(ii) on the death of the reversionary
beneficiary:
(A) to 1 of the dependants
of the reversionary beneficiary; or
(B) to the legal personal
representative of the reversionary beneficiary; and
(h) the capital value of the market linked
pension, and the income from it, cannot be used as security for a borrowing.
(9) Rules mentioned in subregulation (8) are not
prevented from meeting the standards of that subregulation by reason only that
the rules provide that, if the commencement day of the pension is on or after 1
June in a financial year, no payment is required to be made for that financial
year.
(9A) Rules for the provision of a benefit (the
pension) meet the standards of this subregulation if the rules ensure
that payment of the pension is made at least annually, and also ensure that:
(a) for a pension in
relation to which there is an account balance attributable to the beneficiary —
the total of payments in any year (including under a payment split) is at least
the amount calculated under clause 1 of Schedule 7; and
(b) for a pension that is not described in
paragraph (a):
(i) both of the following apply:
(A) the
rules do not provide for a residual capital value, commutation value or
withdrawal benefit greater than 100% of the purchase price of the pension;
(B) the
total of payments in any year (including under a payment split) is at least the amount calculated under clause 2 of
Schedule 7; or
(ii) each of the following applies:
(A) the
pension is payable throughout the life of the beneficiary (primary or
reversionary), or for a fixed term of years that is no greater than the
difference between the primary beneficiary’s age on the commencement day and
age 100;
(B) there
is no arrangement for an amount (or a percentage of the purchase price)
prescribed by the rules to be returned to the recipient when the pension ends;
(C) the
total of payments from the pension in the first year (including under a payment
split) is at least the amount calculated under clause 2 of Schedule 7;
(D) the
total of payments from the pension in a subsequent year cannot vary from the
total of payments in the previous year unless the variation is as a result of
an indexation arrangement or the transfer of the pension to another person;
(E) if
the pension is commuted, the commutation amount cannot exceed the benefit that
was payable immediately before the commutation; or
(iii) the standards of subregulation
(2) are met; or
(iv) for rules in existence at the date
of registration
of the Superannuation Industry (Supervision) Amendment Regulations 2007 (No.
3), the standards of subregulation (2) would be met, except for the
circumstances in which those rules allow for either or both of the following:
(A) the pension to be
commuted;
(B) the variation or
cessation of pension payments in respect of a child of the deceased; and
(c) the pension is
transferable to another person only on the death of the beneficiary (primary or
reversionary, as the case may be); and
(d) the capital value
of the pension and the income from it cannot be used as a security for a
borrowing.
(9B) Rules for the provision of a
benefit do not meet the standards of any of subregulations (2) to (9A) if, in
relation to the death of the beneficiary on or after 1 July 2007, the pension
is transferred or paid to a person who would
not be eligible to be paid a benefit in the form of a pension under
subregulation 6.21 (2A) or (2B).
(9C) If a pension is paid from a successor fund in
accordance with rules to which subparagraph (9A) (b) (iv) applied in the
original fund, the pension meets the standards of subregulation (9A).
(10) Despite regulation 9 of the Income Tax Regulations
1936, for a pension that has a commencement day on or after 20 September
2004 and on or before 31 December 2004, one of the following life tables are to
be used in ascertaining the life expectancy of a person under this regulation:
(a) the most recently published Australian Life
Tables;
(b) the 1995‑97 Australian Life Tables.
(11) In this regulation:
indexation arrangement,
in relation to a pension, means an arrangement specified in the rules for the
provision of the pension that:
(a) results in the total amount of pension
payments in each year:
(i) increasing by the same percentage
factor; or
(ii) being adjusted in line with
movements in the Consumer Price Index; or
(iii) being adjusted in line with
movements in an index of average weekly earnings published by the Australian
Statistician; or
(iv) being adjusted in accordance with
subparagraph (ii) or (iii) but with an increase capped at a maximum level; and
(b) ensures that, unless APRA otherwise approves,
an adjustment is made at least annually to the amount of the pension payments.
1.07 Periods
when beneficiary may not receive benefits
A benefit is not taken not to meet the standards in
regulation 1.05 or 1.06 by reason only that payments of benefit to the
beneficiary have been properly suspended during a period when the beneficiary
is the holder of a paid public office.
1.07A Commutation
of allocated annuities and pensions
(1) This regulation applies in relation to the
following:
(a) a contract mentioned in paragraph 1.05 (1A) (e)
for a benefit (in this regulation called the annuity);
(b) a contract mentioned in paragraph 1.05 (1A)
(g) for a benefit that is an annuity under sub‑subparagraph
1.05 (1A) (g) (i) (A) (in this regulation called the annuity);
(c) rules of a superannuation fund mentioned in
paragraph 1.06 (1A) (c) for a benefit (in this regulation called the pension).
(2) The contract or
rules, meet the standards of this regulation if the contract or rules ensure
that the annuity or pension cannot be commuted, in whole or in part, unless:
(a) the commutation results from the death of an
annuitant or pensioner or a reversionary annuitant or reversionary pensioner;
or
(b) the sole purpose of the commutation is:
(i) to
pay a superannuation contributions surcharge; or
(ii) to give effect to an entitlement
of a non‑member spouse under a payment split; or
(iii) to meet the rights of a client to
return a financial product under Division 5 of Part 7.9 of the Corporations
Act 2001; or
(ba) for a commutation in part — the account
balance of the annuity or pension, immediately after the commutation in part, would
be equal to or would exceed the minimum limit under Schedule 1A or Schedule
1AAB, whichever is applicable to the annuity or pension under subregulation
1.05 (4) or 1.06 (4) as the case may be, as reduced by the
amount of payments to the annuitant or pensioner already made in the
financial year in which the commutation in part would occur; or
(c) the annuity or pension has paid, in the
financial year in which the commutation is to take place, at least the minimum
amount under subregulation (3).
(3) For paragraph (2) (c), the minimum amount is
calculated using the formula:
where:
Days in payment period means the number of
days in the period that:
(a) begins on:
(i) if the annuity or pension
commenced in the financial year in which the commutation is to take
place — the commencement day; or
(ii) otherwise — 1 July in
that financial year; and
(b) ends on the day on which the commutation is
to take place.
Days in financial year means the number of
days in the financial year in which the commutation is to take place (365 or
366).
Minimum annual amount for the financial year
means:
(a) for an annuity mentioned in paragraph
(1) (b) — the minimum limit worked out in accordance with clause 2 of
Schedule 1A or 1AAB as the case may be, as if the annuity account balance was
the amount of the annuity account that is allocated by the annuity provider to
make payments whose size is not fixed, in accordance with subparagraph 1.05 (8) (c) (ii);
and
(b) otherwise — the minimum limit worked out
in accordance with clause 2 of Schedule 1A or 1AAB as the case may be;
rounded to the nearest 10 whole dollars.
1.07B Commutation
of other annuities and pensions
(1) This regulation applies in relation to the
following:
(a) a contract
mentioned in paragraph 1.05 (1) (e) or paragraph 1.05 (1A) (f)
for a benefit (the annuity);
(b) a contract
mentioned in paragraph 1.05 (1A) (g) for a benefit that is an annuity
under sub‑subparagraph 1.05 (1A) (g) (i) (B) (the annuity);
(c) rules of a
superannuation fund mentioned in paragraph 1.06 (1) (c) or
paragraph 1.06 (1A) (d) for a benefit (the pension).
(2) For this regulation, other than for subregulation (5),
the payment year for an annuity or pension means the period of
12 months that begins on the day after:
(a) the commencement day; or
(b) the anniversary of the commencement day.
(3) The contract or
rules, meet the standards of this regulation if the contract or rules ensure
that the annuity or pension cannot be commuted, in whole or in part, unless:
(a) the commutation results from the death of an
annuitant or pensioner or a reversionary annuitant or reversionary pensioner;
or
(b) the sole purpose of the commutation is:
(i) to pay a superannuation
contributions surcharge; or
(ii) to give effect to an entitlement
of a non‑member spouse under a payment split; or
(iii) to meet the rights of a client to
return a financial product under Division 5 of Part 7.9 of the Corporations
Act 2001; or
(c) the annuity or pension has paid, in the
payment year in which the commutation is to take place, at least the minimum
amount under subregulation (4).
(4) For paragraph (3) (c), the minimum amount is
calculated using the formula:
where:
Days in payment period
means:
(a) the number of days in
the period that:
(i) begins
on:
(A) the day after the
anniversary of the commencement day that occurs before the day on which the
commutation is to take place; or
(B) if
the annuity or pension commenced on the day before the start of the payment
year in which the commutation is to take place — the day after the
commencement day; and
(ii) ends on the day on which the
commutation is to take place; or
(b) if subregulation (5) applies —
1 day.
Days in payment year means the number of days
in the payment year in which the commutation is to take place (365 or 366).
Minimum annual amount means:
(a) for an annuity mentioned in paragraph (1) (b) —
the minimum amount that the annuity would pay as fixed‑size payments in
the payment year if the annuity were not commuted; and
(b) otherwise — the minimum amount that the
annuity or pension would pay in the payment year if the annuity or pension were
not commuted.
(5) If the commencement day for an annuity or a pension
is the day on which the commutation of the annuity or pension is to take place:
(a) the payment year is taken to commence on the
commencement day and end on the day before the anniversary of the commencement
day; and
(b) there is taken to be 1 day in the
payment period.
(6) If, to calculate the minimum annual amount, it is
necessary to use a future unknown value of the CPI, that value is taken to be
equal to the CPI for the last known quarter.
1.07C Commutation
of market linked income stream
(1) This regulation applies in relation to the
following:
(a) a contract mentioned in paragraph
1.05 (1) (g) for a market linked annuity;
(b) rules of a superannuation fund mentioned in
paragraph 1.06 (1) (e) for a market linked pension.
(2) The contract or rules
meet the standards of this regulation if the contract or rules ensure that the
annuity or pension cannot be commuted, in whole or in part, unless:
(a) the commutation results from the death of an
annuitant or pensioner or a reversionary annuitant or reversionary pensioner;
or
(b) the sole purpose of the commutation is:
(i) to pay a superannuation
contributions surcharge; or
(ii) to give effect to an entitlement
of a non‑member spouse under a payment split; or
(iii) to meet the rights of a client to
return a financial product under Division 5 of Part 7.9 of the Corporations
Act 2001; or
(ba) for a commutation in part — the account
balance of the annuity or pension, immediately after the commutation in part, would
be equal to or would exceed the total payment amount calculated in accordance
with Schedule 6, as reduced by the amount of payments
to the annuitant or pensioner already made in the financial year in
which the commutation in part would occur; or
(c) the annuity or pension has paid, in the
financial year in which the commutation is to take place, at least the minimum
amount under subregulation (3).
(3) For paragraph
(2) (c), the minimum amount is calculated using the formula:
where:
annual amount for the financial year means the amount
worked out in accordance with Schedule 6 for the annuity or pension, rounded to
the nearest 10 whole dollars.
days in payment period
means the number of days in the period that:
(a) starts on:
(i) if the annuity or pension
commenced in the financial year in which the commutation is to take
place — the commencement day; or
(ii) in any other case —
1 July in that financial year; and
(b) ends at the end of the day on which the
commutation is to take place.
days in financial year means the number of
days in the financial year in which the commutation is to take place.
1.07D Commutation of superannuation income stream
(1) For paragraphs 1.05 (1) (d) and 1.06 (1) (b),
a benefit meets the standards of this regulation if, under the applicable
contract or rules, the annuity or pension cannot be commuted, in whole or in
part, except in the following circumstances:
(a) the commutation
results from the death of the annuitant or pensioner or a reversionary
annuitant or reversionary pensioner; or
(b) the sole purpose of the commutation is:
(i) to pay a
superannuation contributions surcharge; or
(ii) to give
effect to an entitlement of a non‑member spouse under a payment split; or
(iii) to meet
the rights of a client to return a financial product under Division 5 of Part
7.9 of the Corporations Act 2001; or
(c) for a commutation in
part — the account balance of the annuity or pension, immediately after
the commutation, is equal to or greater than the minimum payment amount
calculated in accordance with Schedule 7, as reduced by the amount of
payments to the annuitant or pensioner already made in the financial year in
which the commutation occurs; or
(d) the annuity or
pension has paid, in the financial year in which the commutation takes place,
at least the minimum amount prescribed by subregulation (2).
(2) For paragraph (1) (d), the minimum amount
is the amount calculated using the formula:
where:
days in financial year means the number of days in the financial year (365 or
366) in which the commutation takes place.
days in payment period
means the number of days in the period that:
(a) begins on:
(i) if the
annuity or pension commenced in the financial year in which the commutation is
to take place — the commencement day; or
(ii) otherwise —
1 July in that financial year; and
(b) ends on the day on
which the commutation is to take place.
minimum annual amount means the minimum
amount payable under the annuity or pension, in the financial year, calculated
in accordance with Schedule 7.
Division 1A.2 Operating standards
1.08 Restriction
on factors for converting pensions
(1) For the purposes of subsection 31 (1) of the Act, it
is a standard applicable to the operation of a regulated superannuation fund
that the fund must not use a factor, for converting a prescribed pension to a
lump sum, that is greater than the pension valuation factor that would apply
under Schedule 1B if the commencement day of the pension were the day on which
it was commuted.
(2) Subregulation (1) does
not apply to the use of a factor that:
(a) the Regulator has approved in writing; or
(b) is for conversion in relation to a
commutation to pay a superannuation contributions surcharge; or
(c) is for conversion in relation to a
commutation to give effect to an entitlement of a non‑member spouse under
a payment split.
(3) In this regulation, prescribed pension:
(a) means a pension
(including a benefit that is taken, under these regulations, to be a pension
for the purposes of the Act), other than a benefit that is taken, under
subregulation 1.06 (1), to be a pension by reason only that it is provided
under rules of a superannuation fund that meet the standards of subregulation
1.06 (2); but
(b) does not include any of the following:
(i) an
account‑based pension;
(ii) an
allocated pension;
(iii) a market linked pension.
Part 2 Information for certain parties
Division 2.1 Introductory
2.01 Interpretation
(1) In this Part:
amount includes a nil amount.
contact person, in relation to a
superannuation entity, means a named individual, or a person holding a
designated office or position, who is available to receive and deal with
inquiries or complaints by members or unit‑holders (as the case may be).
(2) In this Part, where the context allows, a reference
to a member is taken to mean:
(a) in relation to a superannuation
entity — a person who:
(i) is a member of the entity; or
(ii) receives a pension from the
entity; or
(iii) has deferred his or her
entitlement to receive a benefit from the entity; and
(b) in relation to an approved deposit
fund — a depositor in the fund; and
(c) in relation to a PST — a unit‑holder.
(3) In a Division of this Part, a reference to a fund is
a reference to a fund of the kind to which the Division applies.
2.02 Scope
and application of this Part
(1) The following Divisions of this Part deal with the
duty of trustees to give information to members or other persons on specified
occasions. Each of the Divisions has an application provision:
(a) stating the types of entity to which the
Division applies; and
(b) referring to any particular provisions of the
Division, or a Subdivision of the Division, that limit or restrict the
application of the Division or Subdivision.
(2) The requirements to give information are expressed
in 2 forms: general requirements (which set out broad principles), and specific
requirements (which set out particular provisions, and may apply in all cases
or only in particular circumstances). The specific requirements are not to be
taken as limiting, by implication, the scope of the general requirements.
(3) This Division governs the other Divisions of this
Part.
2.03 Duties
and requirements arising under this Part
(1) A requirement to give information under a Division
of this Part must be met within the time specified in the Division as the time
for compliance.
Requirements concerning information
(2) Information given in accordance with this Part must:
(a) be in writing; and
(b) be worded and presented in a clear and
effective manner.
(3) Information given in accordance with this Part may
be given, where appropriate, in diagrammatical form.
Where information may mislead (if
incomplete, outdated, etc)
(4) If the trustee of a superannuation entity has reason
to think that information that the trustee is required to give will, or may, be
materially misleading, the trustee must give with the information a statement
containing further information to rectify any misleading, or potentially
misleading, effect.
Example
If a change in a fund’s investment policy means that
information about past earnings rates is not a reliable guide to future
earnings, an appropriate explanation (including the change of policy and its
likely effect on future earnings rates) must be given.
2.04 Reasonable efforts are sufficient
(1) For Division 2.4 or 2.5, the trustee of a
superannuation entity is taken to have satisfied a duty or requirement to give
information to a person if the trustee has taken reasonable steps to give the
information to the person but has been unable to do so.
Information that is unknown and not reasonably obtainable
(2) Where information is unknown to the trustee, the
trustee need not give the information under this Part if the trustee cannot
obtain the information by making reasonable inquiries.
2.05 Charges
for information requested
(1) Subject to this regulation, the obligation of the
trustee of a superannuation entity under these Regulations to give information
on request by a person arises only if the person pays the amount specified by
the trustee as the charge for giving the information.
(2) The amount of the charge must not exceed the
reasonable cost to the superannuation entity of giving the information
(including all reasonably related costs — for example, costs of searching
for, obtaining and collating the information).
(3) A policy committee is not liable to any charge for
information given to it.
Division 2.4 Information to be given for each reporting period
Subdivision 2.4.1 Preliminary
2.17 Interpretation
In this Division:
fund information means information required
to be given under Subdivision 5.6 of Part 7.9 of the Corporations Regulations
2001.
fund reporting period means a reporting
period that applies under Subdivision 5.5 of Part 7.9 of the Corporations
Regulations 2001.
member information means information required
to be given under section 1017D of the Corporations Act 2001.
member reporting period means a reporting
period that applies under section 1017D of the Corporations Act 2001.
2.18 Application
(1) This Division applies to:
(a) a regulated superannuation fund; and
(b) an approved deposit fund.
(2) This Division does not apply to a self managed
superannuation fund.
(3) For the purposes of subsections 31 (1) and 32 (1) of
the Act, a requirement of this Division is a standard applicable to the
operation of a fund to which this Division applies.
Subdivision 2.4.3 Derivatives charge
ratio
2.29 Specific requirements in particular cases
(1) For this Subdivision,
the derivatives charge ratio of a fund is:
expressed as a percentage, where:
X is the market value of the assets of the
fund (other than cash) that are subject to a charge in relation to a
derivatives contract (as defined in subregulation 13.15A (2)).
Y is the market value of all the assets of
the fund.
(2) If paragraph 7.9.37 (1) (i) of the Corporations
Regulations 2001 applies, the trustee must give the information mentioned
in that paragraph to APRA as soon as practicable, and in any event within 6
months, after the end of the reporting period to which the information relates.
Division 2.5 Information on request
2.30 Application
(1) This Division applies to a superannuation entity.
(2) For subsections 31 (1), 32 (1) and
33 (1) of the Act, a requirement of this Division is a standard applicable
to the operation of a superannuation entity.
2.31 Documents may be made available for inspection
It is sufficient
compliance with a requirement under this Division to give information, or to
give a copy of a document, to a person if:
(a) a document containing the information; or
(b) a copy of the document;
as the case requires, is made available for inspection by the
person:
(c) at a suitable place (having adequate
facilities for the person to inspect and photocopy the document); and
(d) during normal
business hours;
or as otherwise agreed between the trustee of a superannuation
entity who is required to give the information to the person, and the person.
2.32 Time
for compliance
The trustee of a superannuation entity must comply
with a request to give information, or a copy of a document, as soon as
practicable, and in any event the trustee must make reasonable efforts to
comply with the request within 1 month after receiving the request.
2.33 Specific
requirements
(1) In this regulation:
concerned person has the same meaning as in
section 1017C of the Corporations Act 2001.
(2) The trustee of a superannuation entity (other than
a self managed superannuation fund) must give to a person (other than a
concerned person), on request in writing by the person, a copy of any of the
following documents (to the extent the trustee has access to the documents)
specified in the request:
(a) audited accounts of the superannuation
entity, together with (whether or not specifically requested) the auditor’s
report in relation to the accounts;
(b) for a regulated superannuation fund or
approved deposit fund — a copy of the fund information that was most
recently given to the members;
(c) for a PST — a copy of the information
mentioned in Subdivision 5.7 of Part 7.9 of the Corporations Regulations
2001 that was most recently given to the members.
Division 2.5A Information about superannuation interest subject to payment
split
2.36B Application
(1) This Division applies
to:
(a) a regulated superannuation fund; and
(b) an approved deposit fund.
(2) For subsections 31 (1) and 32 (1) of the
Act, a requirement of this Division is a standard applicable to the operation
of the fund.
2.36C Information
to be provided by trustee when interest becomes subject to payment split
(1) If an interest in a fund becomes subject to a
payment split, the trustee of the fund must give to the non‑member spouse
in relation to the interest a written notice stating the following information:
(a) the contact details for the fund;
(b) if the interest is not a percentage‑only
interest and the payment split is a base amount split:
(i) the base amount allocated to the
non‑member spouse under the relevant superannuation agreement, flag
lifting agreement or splitting order; and
(ii) the method by which the base
amount will be adjusted on an ongoing basis; and
(iii) whether the governing rules of
the fund would allow the non‑member spouse to become a member of the
fund, and information about the options available to the non‑member
spouse in relation to the interest under Part 7A;
(c) if the interest is not a percentage‑only
interest and the payment split is a percentage payment split:
(i) the percentage that is to apply to
all splittable payments in respect of the interest; and
(ii) whether
the governing rules of the fund would allow the non‑member spouse to
become a member of the fund, and information about the options available to the
non‑member spouse in relation to the interest under Part 7A;
(d) if the interest is a percentage‑only
interest:
(i) the percentage specified in the
relevant superannuation agreement, flag lifting agreement or splitting order;
and
(ii) if the payment split is under a
superannuation agreement or flag lifting agreement, whether the percentage is
to apply for the purposes of subparagraph 90MJ (1) (b) (i) of
the Family Law Act 1975; and
(iii) if the payment split is under a
splitting order, whether the order is made under paragraph
90MT (1) (c) of the Family Law Act 1975;
(e) the circumstances in which the entitlement
of the non‑member spouse will become payable;
(g) if the governing rules of the fund would
allow the
non‑member spouse to become a member of the fund, information that the
non‑member spouse would reasonably need to understand the management and
financial condition of the fund and of any relevant sub‑plan (for
example, the fund’s product disclosure statement);
(h) details of the existence and (in outline
terms) the functions of the Superannuation Complaints Tribunal;
(i) details (in summary form) of arrangements
the fund has to deal with inquiries or complaints;
(j) details of any fee payable by the non‑member
spouse in respect of the payment split, and arrangements for the payment of any
such fee.
(2) The information must be given when the trustee gives
the payment split notice to the non‑member spouse.
Note See regulation 7A.03 for the payment
split notice requirements.
2.36D Other
information to be provided by trustee
(1) This regulation applies to an interest in a fund to
which a transition period (within the meaning of section 1410 of the Corporations
Act 2001) applies, if:
(a) the interest is subject to a base amount
payment split; and
(b) the interest is not a percentage‑only
interest; and
(c) the interest is in the growth phase; and
(d) none of the following has occurred as a
result of a payment split:
(i) a new interest was created for the
non‑member spouse;
(ii) the transferable benefits of the
non‑member spouse were transferred or rolled out of the fund;
(iii) the amount to which the non‑member
spouse is entitled under the payment split was paid, as a lump sum, to the non‑member
spouse.
(2) The trustee of the
fund must give to the member spouse and the non‑member spouse the
following information for each reporting period:
(a) the value of the adjusted base amount
applicable to the non‑member spouse at the end of the reporting period;
(b) the amount of the adjustment in the reporting
period;
(c) the method used to calculate the adjustment,
including the rate of return over the reporting period.
(3) The information
required under subregulation (2):
(a) must be given as soon as practicable after
the end of the relevant reporting period; and
(b) in the case of information that is to be
given to the member spouse, must be given with the information required to be
given to the member spouse under Subdivision 2.4.2 of the old Regulations.
(4) In this regulation:
reporting period means a reporting period
that applies under Subdivision 2.4.2 of the old Regulations.
Note A non‑member may also be
entitled to information under section 1017C of the Corporations Act
2001 and Division 2.5.
2.36E Other
information to be given by trustee — adverse effects on benefits
(1) This regulation applies if:
(a) an interest in a fund is subject to a base
amount payment split or a percentage payment split; and
(b) the interest is not a percentage‑only
interest; and
(c) the interest is in the growth phase; and
(d) none of the following has occurred in respect
of a payment split:
(i) a new interest was created for the
non‑member spouse;
(ii) the transferable benefits of the
non‑member spouse were transferred or rolled out of the fund;
(iii) the amount to which the non‑member
spouse is entitled under the payment split was paid, as a lump sum, to the non‑member
spouse.
(2) The trustee of the fund must give to the non‑member
spouse information about an event if the trustee reasonably believes that:
(a) the event is likely to have a material
effect on the interest in the fund; and
(b) the effect may be adverse (whether the
adverse effect would occur at the time of the event or a later time).
(2A) If:
(a) the member spouse lodges a notice, or makes
a request of a trustee, which would bind the trustee to pay death benefits to a
particular beneficiary or beneficiaries; and
(b) a payment made in accordance with the notice
or request would not be a splittable payment because of the identity or
characteristics of that beneficiary or those beneficiaries;
the trustee must inform the non‑member spouse that the member
spouse has lodged the notice or made the request.
(3) The information required under subregulation (2) or
(2A) must be given before, or as soon as practicable after, the occurrence of
the event.
Part 3 Matters
prescribed or specified in relation to public offer entities
3.01 Public
offer superannuation fund — member of a prescribed class
For the purposes of sub‑subparagraph
18 (1) (a) (ii) (B) of the Act, a prescribed class is a
class of persons, each of whom is:
(a) a former standard employer‑sponsored
member of the fund concerned who, since ceasing to be a standard employer‑sponsored
member of the fund, has remained a member of the fund at all times; or
(b) a spouse, or former spouse, of a standard
employer‑sponsored member of the fund concerned in relation to whom the
fund has accepted eligible spouse contributions from the standard employer‑sponsored
member; or
(c) both:
(i) a spouse, or former spouse, of a
person who is a former standard employer‑sponsored member (the
other person) of the fund concerned; and
(ii) a person in relation to whom the
fund concerned accepted eligible spouse contributions from the other person
while the other person was a member of the fund; or
(d) both:
(i) a spouse, or former spouse, of a
standard employer‑sponsored member (the other person) of a
fund that has the same standard employer‑sponsor as the fund concerned;
and
(ii) a person in relation to whom the
fund concerned has accepted eligible spouse contributions from the other
person; or
(e) both:
(i) a spouse, or former spouse, of a
person who is a former standard employer‑sponsored member (the
other person) of a fund (the other fund) that, at all
times relevant to subparagraph (ii), had the same standard employer‑sponsor
as the fund concerned; and
(ii) a person in relation to whom the
fund concerned accepted eligible spouse contributions from the other person
while the other person was a member of the other fund; or
(f) a non‑member
spouse for whom an interest has been created in the fund, if the original
interest of the member spouse was an interest in that fund; or
(g) a person in relation to whom the fund
concerned has accepted child contributions:
(i) made by a standard employer‑sponsored
member; or
(ii) made by a person who is a former
standard‑employer sponsored member while the person was a member; or
(h) a person in relation to whom the fund
concerned has accepted child contributions:
(i) made by a standard employer‑sponsored
member of a fund that has the same standard employer‑sponsor as the fund
concerned; or
(ii) made by a person who is a former
standard‑employer sponsored member of a fund that has the same standard
employer‑sponsor as the fund concerned:
(A) while the person was a
member of the fund; and
(B) while the fund had the
same standard employer‑sponsor as the fund
concerned; or
(i) a spouse or former spouse of a current or
former standard employer‑sponsored member for whom an interest has been
created in the fund under Division 6.7.
3.04 Section
54 of the Act — prescribed percentages
For the purposes of section 54 of the Act
(prerequisites to variation of repayment period), the following percentages are
prescribed:
(a) in the case of paragraph (1) (c) of the
section — 25%; and
(b) in the case of paragraph (1) (d) of the
section — at least 75%.
3.04A Removal
of trustee of public offer entity — s 60A (2) of the Act
For the purposes of subsection 60A (2) of the
Act, the following kinds of removal are specified:
(a) a removal that will have the immediate
effect that the fund complies with the basic equal representation rules set out
in section 89 of the Act;
(b) a removal that satisfies all of the following
conditions:
(i) the questions of whether the
trustee should be removed, and who should replace the trustee if the removal is
agreed to, have been voted on at a meeting of beneficiaries;
(ii) the beneficiaries who vote (in
person or by proxy) on each question mentioned in subparagraph (i) at the
meeting referred to in that subparagraph hold interests that are in total at
least 25% of the total value of all beneficiaries’ interests in the fund;
(iii) at least 75% by number of the
beneficiaries who vote (in person or by proxy) at the meeting on whether to
remove the trustee vote in favour of removing the trustee;
(iv) at least 75% by number of the
beneficiaries who vote (in person or by proxy) at the meeting on who the new
trustee should be vote in favour of a particular person as trustee;
(v) that person will become the trustee
immediately after the removal takes effect.
3.05 Policy
committees — sections 91, 92 and 93 of the Act
Pre‑1 July 1995 — funds with 200 or more members
(paragraph 91 (3) (b) of the Act)
(1) For the purposes of paragraph 91 (3) (b)
of the Act, subject to subregulation (4), a public offer superannuation fund to
which section 91 of the Act applies is subject to the following rule, namely, that
the trustee of the fund must take all reasonable steps to ensure that, if there
are at least 200 of its members (a group), each of whom:
(a) is a standard employer‑sponsored
member; and
(b) has a standard employer‑sponsor who is
the, or is an associate of a, standard employer‑sponsor of each other
member of that group;
there is at least 1 policy committee established for that group.
Post‑30 June 1995 — funds with more than 4, but fewer
than 50, members (paragraph 92 (3) (b) of the Act)
(2) For the purposes of paragraph 92 (3) (b)
of the Act, subject to subregulation (4), a public offer superannuation fund to
which section 92 of the Act applies is subject to the following rule, namely,
that the trustee of the fund must take all reasonable steps to ensure that if:
(a) there are at least 5 of its members (a
group) each of whom:
(i) is a standard employer‑sponsored
member; and
(ii) has a standard employer‑sponsor
who is the, or is an associate of a, standard employer‑sponsor of each
other member of that group; and
(b) a written request is made to the trustee on
behalf of at least 5 members of the group to establish a policy committee;
there is at least 1 policy committee established for that group.
Post‑30 June 1995 — funds with more than 49 members (paragraph
93 (3) (b) of the Act)
(3) For the purposes of paragraph 93 (3) (b)
of the Act, subject to subregulation (4), a public offer superannuation fund to
which section 93 of the Act applies is subject to the following rules, namely:
(a) the trustee of the fund must take all
reasonable steps to ensure that, if there are more than 49 of its members (a group),
each of whom:
(i) is a standard employer‑sponsored
member; and
(ii) has a standard employer‑sponsor
who is the, or is an associate of a, standard employer‑sponsor of each
other member of that group;
there is at least 1 policy committee
established for that group; and
(b) the trustee of the fund must take all
reasonable steps to ensure that, if:
(i) there are at least 5 but fewer
than 50 of its members (a group), each of whom:
(A) is a standard employer‑sponsored
member; and
(B) has a standard employer‑sponsor
who is the, or is an associate of a, standard employer‑sponsor of each
other member of that group; and
(ii) a written request is made to the
trustee on behalf of at least 5 members of that group to establish a policy
committee;
there is at least 1 policy committee
established for that group.
Rules do not apply to certain funds
(4) If a public offer superannuation fund complies with
the basic equal representation rules stated in section 89 of the Act, the fund
is not subject to the rules set out in subregulations (1), (2) and (3).
Equal representation of employers and members on policy
committees — effect of vacancy
(5) If a vacancy occurs in the membership of a policy
committee of a public offer superannuation fund the policy committee is taken
to consist of equal numbers of employer representatives and member
representatives during the period of the vacancy, in accordance with paragraph
91 (3) (c), 92 (3) (c) or 93 (3) (c) of the Act
(whichever is applicable) if:
(a) immediately before the vacancy occurred, the
policy committee consisted of equal numbers of employer representatives and
member representatives; and
(b) the vacancy is filled within 90 days after it
occurred; and
(c) immediately after the vacancy is filled, the
policy committee consists of equal numbers of employer representatives and
member representatives.
3.06 Policy
committees — functions (paragraphs 91 (3) (b), 92 (3) (b)
and 93 (3) (b) of the Act)
(1) For the purposes of paragraphs 91 (3) (b),
92 (3) (b) and 93 (3) (b) of the Act, a public offer
superannuation fund to which section 91, 92 or 93 of the Act applies is subject
to the following rule, namely, that the functions that a policy committee of a
fund may undertake include the following:
(a) providing an avenue:
(i) for members of the fund to inquire
about the investment strategy and performance of the fund; and
(ii) for the trustee of the fund to
obtain the views of members of the fund concerning that strategy and
performance;
(b) providing an avenue for members of the fund
to inquire about the fund’s operation or performance;
(c) providing an avenue for the trustee of the
fund to obtain the views of members of the fund concerning the fund’s operation
or performance;
(d) providing an avenue for the trustee of the
fund to obtain the views of members of the fund on their information needs;
(e) assisting the trustee of the fund in dealing
with complaints or inquiries about the operation or management of the fund.
(2) Subregulation (1) is not to be taken as limiting by
implication the functions and responsibilities of the trustee.
3.07 Definition
of policy committee in section 10 of the Act — matters specified for
purposes of paragraph (a)
Issues relating to the fund that a member of the
fund, or the employer‑sponsor of a member of the fund, has raised with
the committee as a matter of concern, are specified for the purposes of
paragraph (a) of the definition of policy committee in section 10 of the Act.
3.08 Policy
committees — duties of trustee
(1) In relation to each policy committee of a public
offer superannuation fund, the trustee of the fund must:
(a) ensure, so far as practicable, that the
committee meets at least once in any 12‑month period; and
(b) provide facilities that are reasonably
necessary to enable the committee to meet and to function effectively.
(2) A meeting may be held wholly or in part by means of
a telephone conference connection among the committee members and, if a
representative of the trustee is to attend, the representative.
(3) The trustee must arrange for a representative of the
trustee to attend each meeting of the committee that the committee requests the
trustee to do so.
(4) The trustee may recoup from the fund:
(a) the costs of providing facilities for the
committee to meet; and
(b) the costs incurred by the trustee in
attending a meeting of the committee; and
(c) the costs
incurred by the trustee in providing information to the committee.
Note The amount of costs recouped is
determined in accordance with regulation 5.02
3.09 Dissolution
of policy committees
(1) A policy committee of a public offer superannuation
fund may dissolve itself, and if it does so the trustee of the fund is taken to
have complied with the trustee’s duties under regulation 3.05.
(2) If a policy committee dissolves itself and at least
5 members of the fund, being members in respect of whom the committee
functioned, request the trustee of the fund in writing to form a replacement
committee, the trustee must take all reasonable steps to do so.
(3) The provisions of regulations 3.06, 3.07 and 3.08,
and this regulation, apply to a replacement committee.
3.10 Commission
and brokerage
(1) For the purposes of subsection 154 (1) of the
Act, the requirements set out in this regulation apply in relation to a payment
by the trustee of a public offer entity of commission or brokerage (including
commission or brokerage in the form of remuneration or other benefits) of a
kind mentioned in that subsection.
(2) The trustee of a public offer entity may make a
payment of commission or brokerage to a person in consideration of the person:
(a) applying or agreeing to apply for the issue
of an interest in the entity; or
(b) procuring or agreeing to procure applications
for the issue of an interest in the entity;
if, and only if:
(c) the payment is not prohibited by the
entity’s trust deed; and
(d) where an interest is issued, the applicant
for the issue of the interest has, before the issue occurred, been notified in
writing of the amount or rate of the proposed payment of commission or
brokerage.
(3) The trustee of a
public offer entity must not make a payment of commission or brokerage to a
person (the provider) for the provision of a financial service by
the provider in respect of issuing an interest in the entity unless the
provider is:
(a) a financial services licensee that is
authorised to deal in superannuation products; or
(b) an authorised representative of a financial
services licensee that is authorised to deal in superannuation products; or
(c) exempt from the requirement to hold an
Australian financial services licence; or
(d) the provider of the financial service on
behalf of another person who is exempt.
(4) A reference in subregulation (3) to a solicitor or
accountant includes a reference to a firm of solicitors or accountants, or to a
partner in such a firm, as the case requires.
(5) The trustee of an entity must keep an account of
amounts of commission and brokerage paid by the entity.
3.11 Payment
by trustee of a public offer entity of commission or brokerage
(1) This regulation applies in relation to a person who,
immediately before this regulation commences, was entitled to a payment of
commission or brokerage in the circumstances mentioned in paragraph
3.10 (3) (a), (b), (d), (e) or (f) of the SIS Regulations.
(2) Regulation 3.10, as in force immediately before this
regulation commences, continues to apply in relation to the person’s
entitlement.
(3) Subregulation (2) ceases to apply in relation to
the entitlement on the earlier of:
(a) the day on which the person becomes a
financial services licensee in relation to the activity to which the payment
relates; and
(b) the end of the transition period for the
person mentioned in section 1438 of the Corporations Act 2001.
Part 3A Matters prescribed or specified in relation to licensing of
trustees and of groups of individual trustees
Division 3A.1 Classes of RSE licences
3A.01 Public
offer entity licences
For paragraph 29B (2) (b) of the Act,
the following classes of registrable superannuation entities are specified:
(a) superannuation entities that are
superannuation funds with fewer than 5 members (other than self managed
superannuation funds);
(b) excluded approved deposit funds.
3A.02 Non‑public
offer entity licences
(1) For subsection 29B (3) of the Act, all classes
of registrable superannuation entities, other than the following classes, are
specified:
(a) public offer entities;
(b) superannuation entities that are
superannuation funds with fewer than 5 members (other than self managed
superannuation funds);
(c) excluded approved deposit funds.
(2) The class of RSE licences provided for under
subsection 29B (3) of the Act is called the class of non‑public
offer entity licences.
3A.03 Extended
public offer entity licences
(1) For subsection 29B (4) of the Act, extended
public offer entity licences are a class of RSE licences.
(2) Subject to any
condition imposed on an extended public offer entity licence under subsection
29EA (3) of the Act, the licence enables a trustee that holds a licence of
that class to be a trustee of any registrable superannuation entity.
Note Under paragraphs 29D (1) (g) and 29E
(3) (a) of the Act, an extended public offer entity licence may only be granted
to, and held by, a trustee that is a
constitutional corporation that meets the capital requirements under
section 29DA of the Act.
3A.03A Acting
trustee licences
(1) For subsection 29B (4) of the Act, acting
trustee licences are a class of RSE licences.
(2) Subject to any condition
imposed on an acting trustee licence under subsection 29EA (3) of the Act,
the licence allows:
(a) a trustee that
holds an acting trustee licence; or
(b) a trustee who is a
member of a group of individual trustees that holds an acting trustee licence;
to be a trustee of a registrable superannuation entity or entities
to which the trustee is appointed to act as trustee under section 134 of
the Act by APRA.
(3) For subsection 29E (7)
of the Act, for the period of the licence, a trustee must not, without APRA
approval, carry on a business other than that of performing the functions and
duties of a trustee of a registrable superannuation entity or entities to which the
appointment relates (the trustee business).
(4) APRA may approve the
trustee carrying on a business other than the trustee business if APRA is
satisfied that the carrying on of the other business would not prejudice the
proper and efficient performance of the trustee’s functions and duties.
Division 3A.2 Grant of RSE licences
3A.04 Capital
requirements
(1) For subsection 29DA (2) and paragraphs 29DA (3)
(a) and (4) (b) of the Act, the amount of $5 000 000 is prescribed.
(2) For subsection 29DA
(6) of the Act:
net tangible assets means the
total assets of a constitutional corporation:
(a) less
total liabilities of the corporation; and
(b) less any intangible assets
reported in the corporation’s books of account;
calculated on the basis of assets and liabilities
as they would appear if, at the time of calculation, a balance sheet were made
up for lodgement as part of a financial report under Chapter 2M of the Corporations
Act 2001 (the Corporations Act) on the basis that the corporation
is a reporting entity.
(3) For subregulation (2), at any time before 1 May
2007, an applicant or trustee must calculate its total assets by excluding:
(a) all receivables receivable from either:
(i) a related party as defined by AASB 1017
and Part E2.2 of Chapter 2E of the Corporations Act; or
(ii) a related party as defined by AASB 124
and Part 2E.2 of Chapter 2E of the Corporations Act; and
(b) any assets
that are subject to any charge that secures the liability of a person other
than the corporation, to the extent of the value of that charge; and
(c) any assets
to which the corporation is not legally and beneficially entitled or that are
not held in the name of the corporation; and
(d) any assets (illiquid
assets) that are not capable of being converted into cash in the short
term.
(4) For subregulation (2), an applicant or trustee must
calculate its total liabilities at any time before 1 May 2007 by including all
payables payable to:
(a) a related party as defined by AASB 1017
and Part 2E.2 of Chapter 2E of the Corporations Act; or
(b) a related party as defined by AASB 124
and Part 2E.2 of Chapter 2E of the Corporations Act.
(5) For subregulation (2), an applicant or trustee must:
(a) calculate its total assets on and after 1
May 2007 by excluding:
(i) all receivables receivable from a
related party as defined by AASB 124 and Part 2E.2 of Chapter 2E of the
Corporations Act; and
(ii) any assets that are subject to any
charge that secures the liability of a person other than the corporation, to
the extent of the value of that charge; and
(iii) any assets to which the
corporation is not legally and beneficially entitled or that are not held in
the name of the corporation; and
(iv) any assets (illiquid assets)
that are not capable of being converted into cash in the short term; and
(b) include in its total liabilities on and after
1 May 2007 all payables payable to a related party as defined by AASB 124
and Part 2E.2 of Chapter 2E of the Corporations Act.
(6) In this regulation:
AASB 1017
means AASB 1017, Related Party Disclosures, published by the
Australian Accounting Standards Board, as in force on 1 July 2004.
AASB 124 means AASB 124, Related
Party Disclosures, published by the Australian Accounting Standards Board.
Division 3A.3 Applying for RSE licences
3A.05 Definitions
In this Division:
asset, for a registrable superannuation
entity, means an item described as an asset in a statement of financial
position prepared in respect of the entity.
asset value, for a registrable superannuation
entity, means the value worked out by determining the net balance of the
registrable superannuation entity based on the statement of financial position
prepared in respect of the entity for the last year of income of the entity
before the start of the licensing transition period.
extended public offer entity licence means an
RSE licence of a class specified in regulation 3A.03.
non‑public offer entity licence means
an RSE licence of a class provided for under subsection 29B (3) of the
Act.
statement of financial
position, for a registrable
superannuation entity, means a statement of financial position prepared in
respect of an entity, as a reporting document for the purpose of reporting
standards referred to in section 13 of the Financial Sector (Collection
of Data) Act 2001.
Note The definitions of licensing
transition period and public offer entity licence are
contained in subsection 10 (1) of the Act.
3A.06 Application
fees
For paragraphs
29C (4) (c) and 29F (2) (c) of the Act, the following fees
are prescribed:
|
Item
|
Application
|
|
Fees ($)
|
|
|
|
|
Non‑public offer
entity licence
|
Public offer entity
licence
|
Extended public offer
entity licence
|
|
1
|
Application for RSE licence, other than an application
mentioned in items 2 to 7.
|
5 500
|
20 000
|
20 000
|
|
2
|
Application for non‑public offer entity licence by
an applicant that is a body corporate if:
(a) the body corporate was a trustee of a registrable
superannuation entity at the start of the licensing transition period; and
|
3 500
|
n/a
|
n/a
|
|
|
(b) APRA
is satisfied that the asset value of all registrable superannuation entities
for which the body corporate proposes to become the RSE licensee is less than
$5 000 000; and
|
|
|
|
|
|
(c) item 5 does not apply.
|
|
|
|
|
3
|
Application for non‑public
offer entity licence by an applicant that is a group of individual trustees
if:
(a) any member of the
group was a trustee of a registrable superannuation entity at the start of
the licensing transition period; and
|
3 500
|
n/a
|
n/a
|
|
|
(b) APRA is satisfied that the asset value of all
registrable superannuation entities for which the group proposes to become
the RSE licensee is less than $5 000 000; and
|
|
|
|
|
|
(c) item 5 does not apply.
|
|
|
|
|
4
|
Application for non‑public offer entity licence if,
in the 12 months before the application is made:
|
2 750
|
n/a
|
n/a
|
|
|
(a) the applicant
applied for a licence of that class, for a public offer entity licence, or
for an extended public offer entity licence; and
|
|
|
|
|
|
(b) that application was refused or withdrawn; and
|
|
|
|
|
|
(c) item 5 does not apply.
|
|
|
|
|
5
|
Application for non‑public
offer entity licence by an applicant to whom item 2 or 3 applies if, in the
12 months before the application is made:
|
1 750
|
n/a
|
n/a
|
|
|
(a) the applicant applied for a licence of that class,
for a public offer entity licence, or for an extended public offer entity
licence; and
|
|
|
|
|
|
(b) that application was refused or withdrawn.
|
|
|
|
|
6
|
Application for public
offer entity licence if, in the 12 months before the application is
made:
|
n/a
|
10 000
|
n/a
|
|
|
(a) the applicant
applied for a licence of that class, or for an extended public offer entity
licence; and
|
|
|
|
|
|
(b) that application was refused or withdrawn.
|
|
|
|
|
7
|
Application for extended
public offer entity licence if, in the 12 months before the application is
made:
|
n/a
|
n/a
|
10 000
|
|
|
(a) the applicant applied for a licence of that class,
or for a public offer entity licence; and
|
|
|
|
|
|
(b) that application was refused or withdrawn.
|
|
|
|
|
8
|
Application for variation under paragraph
29F (1) (a):
|
|
|
|
|
|
(a) if the applicant already holds a non‑public
offer entity licence, and item 9 does not apply; or
|
n/a
|
14 500
|
14 500
|
|
|
(b) if the applicant already holds a public offer
entity licence; or
|
500
|
n/a
|
500
|
|
|
(c) if the applicant already holds an extended public
offer entity licence.
|
500
|
500
|
n/a
|
|
9
|
Application for variation
under paragraph 29F (1) (a) if:
|
n/a
|
16 500
|
16 500
|
|
|
(a) the applicant already holds a non‑public
offer entity licence; and
|
|
|
|
|
|
(b) when the applicant applied for that licence, item 2
or 3 applied.
|
|
|
|
Division 3A.4 Conditions on RSE licences
3A.07 Conditions
on RSE licences of FHSA providers
(1) For subsection 29E (7) of the Act, this
regulation sets out conditions that apply to RSE licences of RSE licensees that
hold authorisations as FHSA providers under Part 7 of the FHSA Act.
(2) An RSE licensee must not:
(a) appoint or engage a person to be; or
(b) allow a person to act as;
an investment manager or custodian of a superannuation entity if
the person is a disqualified person under Part 15 of the Act as applied by
Division 2 of Part 7 of the FHSA Act.
(3) An RSE licensee that becomes aware that it has
breached the condition specified in subregulation (2) must, as soon as
practicable after so becoming aware, remove the person from the position of
investment manager or custodian of the trust.
Part 4 Management
and trusteeship of superannuation entities
Division 4.1 Prescribed matters
4.01 Covenants
in governing rules of a superannuation entity — prescribed information and
documents
For the purposes of paragraph 52 (2) (h)
of the Act, the information and documents that are available to a concerned
person under section 1017C of the Corporations Act 2001 are prescribed.
4.02 Covenants
in governing rules of a superannuation entity — beneficiary investment
choice
(1) For the purposes of paragraph 52 (4) (b)
of the Act, the circumstances in which a direction of the kind referred to in
that paragraph (other than a subsequent direction of that kind) may be given
are:
(a) in the case of a direction by a specified
beneficiary who is, or a class of specified beneficiaries each of
whom is, a standard employer‑sponsored member — the
circumstances stated in subregulations (2) and (3); and
(b) in any other case — the circumstances
stated in subregulation (2).
(2) For the purposes of paragraphs (1) (a) and (b),
the following circumstances are stated, namely that:
(a) the trustee gives to the beneficiary, or to
each member of the class of beneficiaries, a choice of 2 or more investment
strategies from which the beneficiary, or class of beneficiaries, may choose a
strategy or combination of strategies; and
(b) the beneficiary, or each member of the class
of beneficiaries, is given:
(i) the investment objectives of each
of the strategies mentioned in paragraph (a); and
(ii) all information the trustee
reasonably believes a person would reasonably need for the purpose of
understanding the effect of, and any risk involved in, each of those
strategies; and
(c) the beneficiary, or each member of the class
of beneficiaries, is fully informed of the range of directions that can be
given and the circumstances in which they can be changed; and
(d) the direction is given after compliance with
the above paragraphs, and the direction specifies:
(i) which of the strategies or which
combination of strategies referred to in paragraph (a) is to be followed in
relation to investments of the beneficiary’s, or class of beneficiaries’,
interest in the fund; and
(ii) where applicable, matters related
to the choice referred to in that paragraph.
Example
A strategy could allow the beneficiary, or class of
beneficiaries, a choice in exposure to certain classes of asset. The
beneficiary may choose 60% in fixed interest loans and 40% in shares and the
choice of the level of exposure to the class of assets would be a ‘matter’
mentioned in subparagraph (ii).
(3) For the purposes of paragraph (1) (a), the
following circumstance is stated, namely that the trustee clearly identifies to
the beneficiary, or to each member of the class of beneficiaries, when giving
to him, her or them a choice of 2 or more investment strategies in accordance
with paragraph (2) (a), the strategy the trustee will adopt if no
direction is given.
(4) Subregulation (3) does not apply in relation to a
beneficiary or a member of a class of beneficiaries if it is a condition of
membership for the beneficiary to choose a strategy or combination of
strategies.
(5) For the purposes of paragraph 52 (4) (b)
of the Act, the circumstances in which a direction of the kind referred to in
that paragraph, if it is a subsequent direction of that kind, may be given are
that:
(a) the beneficiary, or each member of the class
of beneficiaries, is given all information the trustee reasonably believes a
person would reasonably need for the purpose of understanding the effect of,
and any risk involved in, the subsequent direction; and
(b) the subsequent direction is given after
compliance with paragraph (a), and relates to the strategy to be followed in
relation to the investment of the interest in the fund of the beneficiary or
class of beneficiaries.
4.03 Trustee
of employer‑sponsored fund — prescribed direction by employer‑sponsor
or associate of employer sponsor
(1) For the purposes of paragraph 58 (2) (e)
of the Act, the circumstances in which the governing rules of a superannuation
entity (other than a superannuation fund with fewer than 5 members) may
permit an employer‑sponsor or an associate of an employer‑sponsor
to give a direction to the trustee of an employer‑sponsored fund are:
(a) where, after the implementation of the direction:
(i) the fund (if a defined benefit
fund) would not become technically insolvent within the meaning of
subregulation 9.06 (3); or
(ii) the fund (if an accumulation fund)
would not become technically insolvent within the meaning of subregulation 9.35 (3);
and
(b) where the direction would not require the
trustee to contravene the Act (other than section 55) or these regulations; and
(c) where the direction qualifies under
subregulation (2).
(2) A direction qualifies if:
(a) the contributions of the employer‑sponsor
to the fund include contributions that are not mandated employer contributions
(within the meaning of Part 5) and the direction relates solely to either or
both of the following:
(i) those non‑mandated employer
contributions; or
(ii) benefits
related to those non‑mandated employer contributions; or
(b) whether or not paragraph (a) applies —
the direction relates solely to one or more of the following:
(i) the admission of new members to
the fund; or
(ii) the category of members into which
a new member or existing member is to be placed; or
(iii) allowing a person to become an
employer‑sponsor of the fund; or
(iv) the termination of the fund; or
(v) the appointment of a trustee to an
entity that does not have a trustee.
4.04 Governing
rules of a superannuation entity — prescribed exercise of discretion by
non‑trustee
(1) For the purposes of subparagraph
59 (1) (b) (iii) of the Act, the circumstances in which a
discretion under the governing rules of a superannuation entity other than a
self managed superannuation fund may be exercised by a person other than the
trustee are:
(a) where, after the exercise of the discretion:
(i) the fund (if a defined benefit
fund) would not become technically insolvent within the meaning of subregulation
9.06 (3); or
(ii) the fund (if an accumulation fund)
would not become technically insolvent within the meaning of subregulation
9.35 (3); and
(b) where the discretion could have been
exercised by the trustee without contravening the Act (other than section 55)
or these regulations; and
(c) where the discretion qualifies under
subregulation (2).
(2) A discretion qualifies if:
(a) the contributions of the employer‑sponsor
to the fund include contributions that are not mandated employer contributions
(within the meaning of Part 5) and the discretion relates solely to either or
both of the following:
(i) those non‑mandated employer
contributions; or
(ii) benefits related to those non‑mandated
employer contributions; or
(b) whether or not paragraph (a) applies —
the discretion relates solely to one or more of the following:
(i) the admission of new members to
the fund; or
(ii) the category of members into which
a new member or existing member is to be placed; or
(iii) allowing a person to become an
employer‑sponsor of the fund; or
(iv) the termination of the fund; or
(v) the appointment of a trustee to an
entity that does not have a trustee.
4.05 Governing
rules of a superannuation entity — prescribed circumstances of amendment
(1) For the purposes of subparagraph
60 (1) (b) (iii) of the Act, the circumstances in which the
governing rules of a superannuation entity other than a self managed
superannuation fund may be amended are:
(a) where, after the making of the amendment:
(i) the fund (if a defined benefit
fund) would not become technically insolvent within the meaning of
subregulation 9.06 (3); or
(ii) the fund (if an accumulation fund)
would not become technically insolvent within the meaning of subregulation
9.35 (3); and
(b) where the amendment could have been made by
the trustee without contravening the Act (other than section 55) or these
regulations; and
(c) where the amendment qualifies under
subregulation (2).
(2) An amendment qualifies if:
(a) the contributions of the employer‑sponsor
to the fund include contributions that are not mandated employer contributions
(within the meaning of Part 5) and the amendment relates solely to either or
both of the following:
(i) those non‑mandated employer
contributions; or
(ii) benefits
related to those non‑mandated employer contributions; or
(b) whether or not paragraph (a) applies —
the amendment relates solely to one or more of the following:
(i) the admission of new members to
the fund; or
(ii) the category of members into which
a new member or existing member is to be placed; or
(iii) allowing a person to become an
employer‑sponsor of the fund; or
(iv) the termination of the fund; or
(v) the appointment of a trustee to an
entity that does not have a trustee.
4.06 Removal
of member representatives — prescribed circumstances
(1) For the purposes of sub‑subparagraph
107 (2) (a) (ii) (G) of the Act, the circumstances stated
in subregulation (2) are prescribed as circumstances in which member
representatives referred to in subparagraph 107 (2) (a) (ii) of
the Act can be removed other than by the same procedure by which they were
appointed.
(2) The circumstances referred to in subregulation (1)
are:
(a) if the member representative resigns from
the position of trustee, director of the trustee or representative on a policy
committee; or
(b) if the member representative’s tenure of that
position expires; or
(c) if the member representative ceases to be a
member of the fund; or
(d) if the member representative ceases to
satisfy a condition that the member representative was required to satisfy to
be eligible for appointment.
4.07 Removal
of independent trustee or independent member — prescribed circumstances
(1) For the purposes of subparagraph
108 (2) (a) (v) of the Act, the circumstances stated in
subregulation (2) are prescribed as circumstances in which an additional
independent trustee or additional independent director (the office‑holder)
referred to in paragraph 108 (2) (a) of the Act can be removed other than
by the same procedure by which they were appointed.
(2) The circumstances referred to in subregulation (1)
are:
(a) if the office‑holder resigns from
office; or
(b) if the office‑holder’s tenure of office
expires; or
(c) if the office‑holder ceases to be:
(i) in the case of an additional
independent trustee — an independent trustee; or
(ii) in the case of an additional
independent director — an independent director; or
(d) if the office‑holder ceases to satisfy
a condition that the office‑holder was required to satisfy to be eligible
for appointment.
Division 4.1A Content of risk management strategies and risk management
plans
4.07A Risk
management strategies
(1) In this regulation:
material risk means a risk to a body
corporate or group of individual trustees mentioned in subsection 29H (1)
of the Act that has the potential, if realised, to:
(a) adversely affect the interests of members or
beneficiaries of the registrable superannuation entity for which the body or
group is the RSE licensee; or
(b) have a significant impact on the business
operations, reputation, rate of return, profitability or net assets
of the body or group.
(2) For paragraph 29H (2) (c) of the Act, the
following matters are prescribed:
(a) any material risk (a relevant material
risk) that is relevant to the body or group;
(b) an assessment of each relevant material risk,
taking into account:
(i) the likelihood of the risk being
realised; and
(ii) the consequences for the body
or group if the risk is realised;
(c) the way in which the body or group proposes
to treat each relevant material risk, including:
(i) the proposed risk response
strategy or strategies for the risk; and
(ii) the measures and procedures that
the body or group proposes to apply to address the risk;
(d) an
assessment of the residual risk for each relevant material risk, having regard
to:
(i) the
assessment of the relevant material risk under paragraph (b); and
(ii) the
likely effect of the proposed treatment of the relevant material
risk under paragraph (c);
(e) the proposed arrangements for internal
oversight, implementation and reporting in relation to the management of the
relevant material risks by the body or group.
Note An RSE licence will not be granted
unless APRA is satisfied that the risk management strategy for the body
corporate or group of individual trustees meets the requirements of section 29H
of the Act: see paragraph 29D (1) (e) of the Act.
4.07B Risk
management plans
(1) In this regulation:
material risk means a risk to a registrable
superannuation entity that has the potential, if realised, to:
(a) adversely affect the interests of members or
beneficiaries of the entity; or
(b) have a significant impact on the business
operations, reputation, rate of return, profitability or net assets
of the entity.
(2) For paragraph 29P (2) (c) of the Act, the
following matters are prescribed:
(a) any material risk (a relevant material
risk) that is relevant to the registrable superannuation entity;
(b) an assessment
of each relevant material risk, taking into account:
(i) the likelihood of the risk being
realised; and
(ii) the consequences for the entity if
the risk is realised;
(c) the way in which the RSE licensee proposes
to treat each relevant material risk, including:
(i) the proposed risk response
strategy or strategies for the risk; and
(ii) the measures and procedures that
the RSE licensee proposes to apply to address the risk;
(d) an
assessment of the residual risk for each relevant material risk, having regard
to:
(i) the
assessment of the relevant material risk under paragraph (b); and
(ii) the
likely effect of the proposed treatment of the
relevant material risk under paragraph (c);
(e) the proposed arrangements for internal
oversight, implementation and reporting in relation to the management of the
relevant material risks by the RSE licensee.
Note A registrable superannuation entity
will not be registered unless APRA is satisfied that the risk management plan
for the entity meets the requirements of section 29P of the Act: see paragraph
29M (1) (d) of the Act.
Division 4.2 Operating standards
4.08 Operating
standard — voting rule where equal representation applies
(1) For the purposes of subsection 31 (1) of the
Act, the standard stated in subregulation (3) is applicable to the operation of
standard employer‑sponsored funds that must comply:
(a) under subsection 91 (4) or 93 (4)
of the Act — with the basic equal representation rules; or
(b) under subsection 90 (3) of the
Act — with either:
(i) the basic equal representation
rules; or
(ii) the alternative agreed
representation rule set out in subsection 90 (4) of the Act; or
(c) under subsection 92 (4) of the
Act — with either:
(i) the basic equal representation
rules; or
(ii) the alternative agreed
representation rule set out in subsection 92 (5) of the Act.
(2) Despite subregulation (1), the standard stated
in subregulation (3) is not applicable:
(a) to the operation of standard employer‑sponsored
funds that comply with the alternative agreed representation rule set out in subsection
90 (4) or 92 (5) of the Act; or
(b) to a decision of a delegate of the individual
trustees or of the board of directors of the corporate trustee of the fund if
the delegation was approved by at least two‑thirds of the total number of
the trustees or directors.
(3) A decision of:
(a) the individual trustees of a fund; or
(b) the board of directors of the corporate
trustee of a fund;
must be taken not to have been made, or to be of no effect, if
fewer than two‑thirds of the total number of the trustees or directors,
as the case requires, voted for it.
4.08A Operating
standard — member representation for certain regulated superannuation
funds where a declaration under subsection 18 (7) of the Act applies
(1) For the purposes of subsection 31 (1) of the
Act, the standard stated in subregulation (2) applies to the operation of
regulated superannuation funds.
(2) A regulated superannuation fund:
(a) that is not a standard employer‑sponsored
fund; and
(b) that has more than 4 members; and
(c) in relation to which a declaration under
subsection 18 (7) of the Act is in force;
must have in place an arrangement in relation to the management and
control of the fund that:
(d) has been agreed to by a majority of the
members of the fund; and
(e) is approved by APRA in writing.
Note Subsection 18 (7) of the Act
allows for funds to be declared not to be public offer funds.
(3) An approval for paragraph (2) (e):
(a) is subject to any conditions specified in
the instrument of approval; and
(b) may be revoked by APRA by written notice
given to the holder of the approval.
(4) APRA may vary the conditions of an approval for
paragraph (2) (e) by written notice given to the holder of the
approval.
(5) An approval that:
(a) was granted by the Commissioner or APRA
under the regulation 4.08A that, under section 2 of Modification Declaration
10, had effect as if it had been inserted into these regulations; and
(b) was in force immediately before
1 March 2001;
continues in force as if granted by APRA for this regulation after
that commencement.
Note Modification Declaration 10 was
gazetted on 19 July 1995 under section 332 of the Act.
(6) When deciding whether or not to approve an
arrangement for paragraph (2) (e), APRA must have regard to any
written guidelines determined by APRA under this subregulation.
(7) This regulation does not apply to a fund if the fund
has an acting trustee appointed under Part 17 of the Act.
4.09 Operating
standard — investment strategy
(1) For the purposes of subsections 31 (1), 32 (1)
and 33 (1) of the Act, the standard stated in subregulation (2) is
applicable to the operation of superannuation entities.
(2) The trustee of the entity must formulate and give
effect to an investment strategy that has regard to all the circumstances of
the entity, including in particular:
(a) the risk involved in making, holding and
realising, and the likely return from, the entity’s investments, having regard
to its objectives and expected cash flow requirements;
(b) the composition of the entity’s investments
as a whole, including the extent to which they are diverse or involve exposure
of the entity to risks from inadequate diversification;
(c) the liquidity of the entity’s investments,
having regard to its expected cash flow requirements;
(d) the ability of the entity to discharge its
existing and prospective liabilities.
(3) An investment strategy is taken to be in accordance
with subregulation (2) even if it provides for a specified beneficiary or class
of beneficiaries to give directions to the trustee where the directions:
(a) relate to the strategy to be followed by the
trustee in relation to the investment of a particular asset or assets of the
entity; and
(b) are given in the circumstances covered by
regulation 4.02.
4.10 Operating
standard — investment by non‑complying superannuation funds
For the purposes of subsection 31 (1) of the
Act, it is a standard applicable to the operation of regulated superannuation
funds that, if the Regulator gives a notice to the trustee of an entity stating
that the entity is not a complying superannuation fund, the trustee must take
all reasonable steps to immediately dispose of any units held by the trustee in
a PST, unless the Regulator otherwise directs.
4.10A Operating
standard — ownership of units in a PST [see Note 2]
(1) For paragraph 33 (2) (aa) of the Act, the
standard stated in subregulation (2) is applicable to a registrable
superannuation entity that is a PST.
(2) A trustee of the registrable superannuation entity
must not offer ownership of units in the registrable
superannuation entity unless the registrable superannuation
entity is registered under Part 2B of the Act.
4.11 Operating
standard — investment by non‑complying approved deposit funds
For the purposes of subsection 32 (1) of the
Act, it is a standard applicable to the operation of approved deposit funds
that, if APRA gives a notice to the trustee of an entity stating that the
entity is not a complying approved deposit fund, the trustee must take all
reasonable steps to immediately dispose of any units held by the trustee in a
PST, unless APRA otherwise directs.
4.11A Operating
standard — acceptance of deposits by an approved deposit fund [see Note 2]
(1) For paragraph 32 (2) (aa) of the Act, the
standard stated in subregulation (2) is applicable to a registrable
superannuation entity that is an approved deposit fund.
(2) A trustee of the registrable superannuation entity
must not accept deposits unless the registrable superannuation entity is
registered under Part 2B of the Act.
4.12 Operating
standard — acceptance by regulated superannuation and approved deposit
funds of rollovers and transfers
(1) For the purposes of subsections 31 (1) and
32 (1) of the Act, it is a standard applicable to the operation of
regulated superannuation funds and approved deposit funds that the trustee of a
fund (the receiving trustee) must not accept the rollover or
transfer of a benefit from another regulated superannuation fund or approved
deposit fund, or from an EPSSS or RSA, (the transferring entity)
if:
(a) the receiving trustee has reasonable grounds
to believe that the benefit being rolled over or transferred is being rolled
over or transferred on the basis of a belief held by the trustee or RSA
provider of the transferring entity (as the case requires) that the receiving
trustee has received the member’s or RSA holder’s consent to the rollover or
transfer; and
(b) the receiving trustee has not received that
consent.
(2) In this regulation:
consent means:
(a) written consent; or
(b) any other form of consent determined by the
Regulator as sufficient in the circumstances.
4.13 Operating
standard — lending to members of an approved deposit fund
(1) For the purposes of subsection 32 (1) of the
Act, the standards stated in subregulations (2) and (3) are standards
applicable to the operation of approved deposit funds.
(2) The trustee of a fund must not:
(a) lend money of the fund to:
(i) a member of the fund; or
(ii) a relative of a member of the
fund; or
(b) give any other financial assistance using the
resources of the fund to:
(i) a member of the fund; or
(ii) a relative of a member of the
fund.
(3) The trustee of a fund must take all reasonable steps
to ensure that the investment manager does not:
(a) lend money of the fund to:
(i) a member of the fund; or
(ii) a relative of a member of the
fund; or
(b) give any other financial assistance using the
resources of the fund to:
(i) a member of the fund; or
(ii) a relative of a member of the
fund.
(4) In this regulation:
member, of a fund, includes the non‑member
spouse in relation to a superannuation interest in the fund that is subject to
a payment split.
relative has the same meaning as in the
Income Tax Assessment Act.
4.14 Operating
standard — fitness and propriety of RSE licensee
(1) In this regulation:
disqualified person means a disqualified
person for Part 15 of the Act.
fit and proper standard means the standard
mentioned in subregulation (3).
(2) For paragraphs 31 (2) (ma), 32 (2) (fa) and 33 (2)
(ba) of the Act, the standard stated in this regulation is applicable to an RSE
licensee.
Note An RSE licence will not be granted
unless APRA is satisfied under paragraph 29D (1) (d) of the Act that the
standard stated in this regulation is met.
(3) Subject to subregulations (5) and (6), an RSE
licensee meets the fit and proper standard if the RSE licensee possesses
relevant attributes that enable the RSE licensee to properly discharge the
duties and responsibilities of an RSE licensee in a prudent manner.
(4) The attributes include, but are not limited to:
(a) character, competence, diligence,
experience, honesty, integrity and judgement; and
(b) educational or technical qualifications,
knowledge and skills relevant to the duties and responsibilities of an RSE
licensee.
(5) An RSE licensee that is a body corporate does not
meet the fit and proper standard if:
(a) the body corporate is a disqualified person;
or
(b) a director of
the body corporate is a disqualified person, and the body corporate does not,
within 14 days after the body corporate becomes aware that the
director is a disqualified person:
(i) notify APRA of that fact; and
(ii) remove the director.
(6) An RSE licensee that is a group of individual
trustees does not meet the fit and proper standard if:
(a) an individual trustee who is a member of the
group of individual trustees (the member) is a
disqualified person; and
(b) the group of individual trustees does not,
within 14 days after the group becomes aware that the member is a disqualified
person:
(i) notify APRA of that fact; and
(ii) remove the member from the group.
(7) An RSE licensee must meet the fit and proper
standard for all the period during which the RSE licence continues in force.
4.15 Operating
standard — adequacy of resources of, or available to, trustees of
registrable superannuation entities (RSE licensees)
(1) In this regulation:
adequate financial resources includes:
(a) adequate resources to ensure the ongoing
solvency of the RSE licensee; and
(b) adequate liquidity to support the business
operations of the RSE licensee.
adequate human
resources includes adequate levels of personnel with the necessary
knowledge, skills and expertise to enable the RSE licensee to effectively carry
out its operations.
adequate technical
resources includes:
(a) adequate technical systems, including
adequate hardware and software; and
(b) adequate systems and resources to ensure
protection, security and privacy of confidential, personal and sensitive
material; and
(c) adequate technical resources to handle
transaction processing and other operations; and
(d) adequate technical resources to handle any
significant changes or increases in business size or capacity that are planned
or forecast or that are likely to occur; and
(e) adequate disaster recovery and business
continuity plans; and
(f) adequate records maintenance systems.
(2) For paragraphs 31 (2) (sb), 32 (2) (lb) and 33 (2)
(jb) of the Act, the standard stated in this regulation is applicable to
trustees of registrable superannuation entities as follows:
(a) if the trustee is a body corporate that
holds an RSE licence — the body corporate;
(b) if the trustee is a member of a group of
individual trustees that holds an RSE licence — the group.
Note An RSE licence will not be granted
unless APRA has no reason to believe that the RSE licensee law would not be
complied with. The RSE licensee law includes this regulation. See subsection 10
(1) and paragraph 29D (1) (a) of the Act.
(3) The body or group must, for all of the period during
which the RSE licence continues in force, have adequate human, technical and
financial resources available to it to enable it to undertake its activities as
an RSE licensee.
(4) The body or group has adequate human, technical or
financial resources available to it if:
(a) it has adequate resources of that kind in
its own right; or
(b) it has available to it adequate resources of
that kind under an enforceable agreement or undertaking.
4.16 Operating
standard — outsourcing arrangements of RSE licensees
(1) In this regulation:
material business activity means a business
activity of the RSE licensee of a registrable superannuation entity, a
disruption to which, or the poor performance of which, has the potential to:
(a) affect the interests of members or beneficiaries
of the entity; or
(b) have a significant impact on the business
operations, reputation, rate of return, profitability or net assets of:
(i) the entity; or
(ii) the RSE licensee of the entity.
material outsourcing agreement means an
agreement or arrangement:
(a) under which a person other than the RSE
licensee (a service provider) is to perform a material business
activity; and
(b) entered into with the service provider by:
(i) if the RSE licensee is a body
corporate — the body corporate; or
(ii) if the RSE licensee is a group of
individual trustees — the group as a whole, or any member of the group.
service provider does not include:
(a) if the RSE licensee is a body
corporate — an employee of the body corporate acting in the capacity of an
employee of the body corporate, or an officer of the body corporate acting in
the capacity of an officer of the body corporate; or
(b) if the RSE licensee is a group of individual
trustees — an employee of the group, or an employee of any member of the group,
acting in the capacity of an employee of the group, or in the capacity of an
employee of a member of the group.
(2) For paragraphs 31 (2) (sa), 32 (2) (la) and 33 (2)
(ja) of the Act, the standard stated in this regulation is applicable to
material outsourcing agreements.
Note An RSE licence will not be granted
unless APRA has no reason to believe that the RSE licensee law would not be
complied with. The RSE licensee law includes this regulation. See subsection 10
(1) and paragraph 29D (1) (a) of the Act.
(3) A material outsourcing agreement must comply with
this regulation.
(4) A material outsourcing agreement must:
(a) be in writing; and
(b) state the commencement date of the agreement;
and
(c) contain default arrangements and termination
provisions; and
(d) provide for dispute resolution; and
(e) contain liability and indemnity provisions;
and
(f) provide for confidentiality, privacy and
security of information; and
(g) contain a pricing, fee and payments
structure in relation to the performance of the material business activity; and
(h) contain audit, monitoring and assessment
procedures in relation to the performance of the material business activity;
and
(i) provide for business continuity planning,
including transfer protocols relating to the handover of functions from the
service provider to either a successor service provider or the RSE licensee on
the cessation of the material outsourcing agreement.
(5) A material
outsourcing agreement must provide that:
(a) the service provider must, on the written
request of the RSE licensee or APRA, and within a time and at a
place specified in the request that is reasonable in the circumstances, provide
the RSE licensee or APRA, as requested, with any documents or
information in the possession of the service provider relating to:
(i) the material outsourcing agreement;
or
(ii) the material business activity
performed under the agreement; and
(b) the service provider must, on the written
request of the RSE licensee or APRA, and at a time that is reasonable in the
circumstances, allow the RSE licensee or APRA, as requested, to:
(i) conduct on‑site visits to
the service provider’s premises; and
(ii) access any documents or information
relating to the registrable superannuation entity held at those premises; and
(c) the service provider must, on the written
request of the RSE licensee or APRA, and within a time specified in the request
that is reasonable in the circumstances, have an audit of its business activities
under the material outsourcing agreement conducted by an independent auditor.
(6) A material outsourcing agreement must provide that
any agreement or arrangement that a service provider enters into with another
service provider for the performance of a material business activity under the
material outsourcing agreement must comply with this subregulation and with
subregulations (4) and (5), as if the agreement or arrangement were a material
outsourcing agreement.
(7) An RSE licensee or a service provider must not
charge APRA a fee for any of the following:
(a) the provision of, or provision of access to,
any documents or information under subregulation (5);
(b) the provision of access to the service
provider’s premises under subregulation (5);
(c) the conduct of an independent audit
requested under subregulation (5).
(8) An RSE licensee must, if requested to do so by APRA,
take all reasonable steps to enforce the material outsourcing agreement against
a service provider in relation to:
(a) any matter mentioned in paragraph (5) (a),
(b) or (c); and
(b) the matter
mentioned in subregulation (6).
Note Part 15 of the Act also contains
standards for trustees, custodians and investment managers of superannuation
entities.
4.17 Outsourcing
arrangements for licensing transition period
(1) In this regulation:
arrangements includes agreements or
arrangements entered into at any time before the end of the licensing
transition period.
business activity means a business activity
that would be a material business activity if the business activity was a
business activity of an RSE licensee.
(2) Any arrangements that are in place for the
outsourcing of a business activity that were entered into by a person who:
(a) was a trustee of a registrable
superannuation entity at the start of the licensing transition period; and
(b) was not an RSE licensee, or was not a member
of a group that was an RSE licensee, at the time the arrangements were entered
into;
must, at or before the end of the licensing transition period:
(c) comply with
the standard stated in regulation 4.16; or
(d) be terminated
by the person.
Note Licensing transition period
is defined in subsection 10 (1) of the Act.
Part 5 Benefit
protection standards
Division 5.1 Preliminary
5.01 Interpretation
(1) In this Part, unless the contrary intention appears:
accumulated deposit, in relation to a member
of an approved deposit fund as at a particular time, means the total of the
following amounts:
(a) amounts deposited in the fund for the member
down to that time; and
(b) investment earnings on those amounts down to
that time; less:
(c) the costs applicable to those amounts down
to that time.
administration costs includes all fees and
charges charged against a member’s benefits (whether or not charged against the
contributions by or in respect of the member), other than:
(a) in the case of a member who was a member of
the fund on 30 June 1995, the exit fee (if any) applicable to the member’s
benefits at that date; and
(b) the cost (if any) of providing to the member:
(i) an insured death benefit; or
(ii) an insured permanent or temporary
incapacity benefit; and
(c) taxation costs.
Note Examples of ‘taxation costs’:
contributions tax, superannuation contributions surcharge.
cashed means cashed in accordance with
Division 6.3.
costs, in relation to a member’s benefits in
a regulated superannuation fund or an approved deposit fund as at any time,
means the total costs determined under regulation 5.02 in relation to those
benefits and charged to those benefits in accordance with that regulation down
to that time.
deferred annuity
means an annuity that is not payable on purchase, and the terms of which
ensure:
(a) that payment of benefits under the annuity:
(i) is not
commenced earlier than the time at which Part 6 permits or requires the
benefits to be paid from an approved deposit fund; and
(ii) is to commence as soon as
practicable after the annuitant:
(A) dies;
or
(B) if
the annuitant dies before attaining the age of 65 — would have attained
that age; and
(b) that, except as permitted in relation to
approved deposit funds by the Act or these Regulations, the provider of the
annuity is not taken to recognise, or in any way encourage or sanction:
(i) an
assignment of an interest under the annuity; or
(ii) the
giving of a charge over, or in relation to, the annuity.
Government co‑contribution benefits
means Government co‑contributions made under the Co‑contribution
Act, less:
(a) the costs applicable to them; and
(b) any amounts repaid under section 24 of the Co‑contribution
Act.
investment earnings, in relation to a
member’s benefits (or a members’ benefits of a particular kind) in a regulated
superannuation fund or an approved deposit fund as at any time, means the total
of the amounts credited, less the total of the amounts debited, to the member’s
account by way of investment return down to that time in respect of those
benefits.
investment return, in relation to a member’s
benefits (or a member’s benefits of a particular kind) in a regulated
superannuation fund or an approved deposit fund over a particular period means:
(a) in the case of an approved deposit fund or
an accumulation fund in which the trustee does not maintain reserves — the
proportion of the return to the fund on investments over that period that is
attributable to those benefits; or
(b) in the case of
an approved deposit fund or an accumulation fund in which the trustee maintains
reserves — the return determined by the trustee in accordance with
regulation 5.03 for that period; or
(c) in the case of a defined benefit fund:
(i) the proportion of the return to
the fund on investments over that period that is attributable to those
benefits; or
(ii) the return on the benefits over
that period that is fair and reasonable to all members of the fund, being a
return based either on the actual return earned on the investments of the fund
or on a commercially available rate of interest; or
(iii) the return on the benefits that
is derived by increasing the benefits in proportion with the increase in the
salary of the member over that period.
mandated employer contributions, in relation
to a member of a regulated superannuation fund, means contributions by, or on
behalf of, an employer that are equal to the sum of:
(a) the contributions made by, or on behalf of,
the employer to the fund in relation to the member, that:
(i) reduce the employer’s potential
liability for the superannuation guarantee charge imposed by section 5 of the
Superannuation Guarantee Charge Act 1992; or
(ii) are payments of shortfall components;
and
(b) the contributions (other than contributions
of the kind specified in paragraph (a)) made by, or on behalf of, the employer
to the fund in relation to the member in or towards satisfaction of the
employer’s obligation to make contributions for the member, being an obligation
under an agreement certified, or an award made, on or after 1 July 1986 by
an industrial authority.
mandated employer‑financed benefits, in
relation to a member of a regulated superannuation fund as at a particular
time, means benefits equal to the sum of:
(a) the amount of the mandated employer
contributions (if any) made to the fund in relation to the member down to
that time; and
(b) the amount of the mandated employer‑financed
benefits (if any) paid into the fund in relation to the member down to that
time; and
(c) the amount of the investment earnings on
those contributions and benefits down to that time;
less the costs applicable to the amounts down to that time.
member contributions, in relation to a member
of a regulated superannuation fund, means contributions by, or on behalf of,
the member to the fund, but does not include employer contributions made in
respect of the member.
member‑financed benefits, in relation
to a member of a regulated superannuation fund as at a particular time, means
benefits equal to the sum of:
(a) the amount of the member contributions (if
any) made to the fund in relation to the member down to that time; and
(b) the amount of the member‑financed
benefits (if any) paid into the fund in relation to the member down to that
time; and
(c) the amount of the investment earnings on
those contributions and benefits down to that time;
less the costs applicable to those amounts down to that time.
OSS Laws means:
(a) the Occupational Superannuation Standards
Act 1987 as in force immediately before the commencement of section 5 of
the Occupational Superannuation Standards Amendment Act 1993; and
(b) the Occupational Superannuation Standards
Regulations.
rolled over means paid as a superannuation lump sum (other than by way
of being transferred) within the superannuation system.
superannuation provider means:
(a) the trustee of a regulated superannuation
fund; or
(b) the trustee of an approved deposit fund; or
(c) an RSA provider.
superannuation system means the system
comprising:
(a) regulated superannuation funds; and
(b) approved deposit funds; and
(c) the Commissioner of Taxation in the
Commissioner of Taxation’s role as the maker of payments to a superannuation
provider under the Superannuation (Unclaimed Money and Lost Members) Act
1999; and
(d) deferred annuities; and
(e) EPSSSs; and
(h) RSAs; and
(i) annuities.
transferred, in relation to a member’s
benefits paid out of, or received by, a regulated superannuation fund or
approved deposit fund, means paid to, or received from:
(a) another regulated superannuation fund or
approved deposit fund; or
(b) an RSA provided by an RSA institution; or
(c) an EPSSS;
otherwise than upon the satisfaction by the member of a
condition of release (within the meaning of Part 6) for all those benefits.
(2) For the purposes of this Part, a payment from the Superannuation Holding Accounts Special Account is
taken to be a mandated employer contribution.
5.01A Operating
standards — determination of costs and investment return
For the purposes of subsections 31 (1) and
32 (1) of the Act:
(a) the standard set out in subregulations
5.02 (1) and (3), 5.02B (2), 5.02C (2) and 5.03 (2) is
applicable to the operation of regulated superannuation funds and approved
deposit funds; and
(b) the standard set out in subregulation
5.03 (1) is applicable to the operation of:
(i) accumulation funds; and
(ii) approved deposit funds;
that maintain reserves.
5.01B Trustee
may provide greater protection than this Part requires
The trustee of a
regulated superannuation fund or approved deposit fund has the power, despite
anything in the governing rules of the fund, to protect the benefits of
members:
(a) to a greater degree than is required by this
Part; or
(b) from an earlier date than is required by this
Part;
if the trustee does so in a way that is consistent with this Part.
Note For example, a trustee might choose
to protect the benefits of all members with withdrawal benefits less than
$1,500, rather than all protected members (i.e., broadly, members with
withdrawal benefits less than $1,000) as this Part requires. Protected
member is defined in regulation 1.03.
5.02 Determination
of costs
(1) The trustee of a regulated superannuation fund or an
approved deposit fund must determine the costs to be charged from time to time
against a member’s benefits in the fund.
(2) In determining the costs to be charged against a
member’s benefits, the trustee may include:
(a) the direct costs of establishing, operating
and terminating the fund; and
(b) any administrative, insurance and taxation
costs relating to the establishment, operation and termination of the fund; and
(c) if the member’s benefits are subject to a
payment split, the costs incurred in administering the payment split (not
including the costs offset by any fees payable under regulation 59 of the Family
Law (Superannuation) Regulations 2001 in respect of the payment split).
(3) Subject to the member‑protection standards and
regulation 5.01B, in determining the costs to be charged against a member’s
benefits, the trustee must ensure that the costs of the fund (including the
costs (if any) incurred by the fund as a result of the operation of Division
5.4) are distributed in a fair and reasonable manner as between:
(a) all the members of the fund; and
(b) the various kinds of benefits of each member
of the fund.
5.02A Meaning
of fair and reasonable
(1) For the purposes of subregulation 5.02 (3), a
distribution of costs in relation to a fund is not fair and reasonable if, in
respect of a period that is, in relation to the fund, a good investment period,
the trustee of the fund applies administration costs (being administration
costs that would, but for the member‑protection standards, be applied to
erode the minimum benefits of members of the fund to whom the member‑protection
standards apply) in a way that erodes the benefits (other than the minimum
benefits) of those members.
(2) For the purposes of subregulation (1), a period is a
good investment period in relation to a fund if the total administration costs
that would be charged to members of the fund but for regulation 5.17 is not
greater than the total investment return of the fund that would be credited to
members of the fund in respect of the period but for that regulation.
5.02B Priority in deducting surcharge or
instalment
(1) This regulation applies if a trustee has decided to
reduce a member’s benefits in connection with payment of a superannuation
contributions surcharge or an advance instalment of surcharge.
(2) In reducing the member’s
benefits, the trustee must:
(a) if possible — deduct an amount equal to
the whole of the amount of the reduction from the preserved benefits; and
(b) if the required deduction cannot be met under
paragraph (a) — deduct the balance from the restricted non‑preserved
benefits; and
(c) if the required deduction cannot be met
under paragraphs (a) and (b) — deduct the balance from the unrestricted
non‑preserved benefits.
5.02C Refund of costs
(1) The trustee of a regulated superannuation fund or
approved deposit fund may refund, to a member’s benefits in the fund, costs
charged against the member’s benefits.
(2) In determining the amount of refund to be credited,
the trustee must ensure that the total amount to be refunded is distributed in
a fair and reasonable manner to all the members of the fund against whom the
costs were charged.
5.03 Investment
returns
(1) The trustee of an accumulation fund or an approved
deposit fund that maintains reserves must determine the investment return to be
credited or debited from time to time to a member’s benefit (or benefits of a
particular kind) in the fund, having regard to:
(a) the return to the fund on investments; and
(b) the extent to which the costs of the fund exceed
(or fall below) the aggregate of the costs charged to member’s benefits under
regulation 5.02; and
(c) the level of the reserves of the entity.
(2) Subject to the member‑protection standards,
regulation 5.01B and Division 6.1, the trustee of a regulated superannuation
fund or an approved deposit fund must determine the investment return to be
credited or debited to a member’s benefits (or benefits of a particular kind)
in a way that is fair and reasonable as between:
(a) all the members of the fund; and
(b) the various kinds of benefits of each member
of the fund.
Division 5.2 Minimum
benefits
5.04 Minimum benefits — regulated
superannuation funds
(1) Subject to regulations 5.05, 5.06 and 5.06B, a
member’s minimum benefits in a regulated superannuation fund are as set out in
this regulation.
(2) If the fund is an accumulation fund, the member’s
minimum benefits are all of the member’s benefits in the fund.
(3) If the fund is a defined benefit fund, the member’s
minimum benefits are as follows:
(a) if the member belongs to a class of
employees in relation to which a relevant benefit certificate applies, the
amount of the member’s minimum requisite benefit; or
(b) in any other case:
(i) the member’s member‑financed
benefits; and
(ii) the member’s mandated employer‑financed
benefits; and
(iii) Government co‑contribution
benefits and any investment earnings on them; and
(iv) any
amount allocated under regulation 292‑170.03 of the Income Tax
Assessment Regulations 1997.
5.05 Mandated employer contributions —
regulated superannuation funds
(1) Subject to this regulation, contributions to a
regulated superannuation fund are taken to be mandated employer contributions.
(2) If:
(a) at least 1 year has elapsed since the fund
received the contributions; and
(b) the trustee:
(i) is satisfied that the
contributions are not in fact mandated employer contributions; and
(ii) decides not to continue to treat
the contributions as mandated employer contributions;
subregulation (1) ceases to apply to the contributions.
(3) If:
(a) less than 1 year has elapsed since the fund
received the contributions; and
(b) the trustee is satisfied that the
contributions are not in fact mandated employer contributions;
subregulation (1) ceases to apply to the contributions.
(4) The trustee has power to make a decision of the kind
mentioned in subparagraph 2 (b) (ii) despite anything in the
governing rules of the fund.
Example of the application of this
regulation
A trustee of a fund may receive a non‑mandated
employer contribution from an employer‑sponsor of the fund that the
trustee does not know is a non‑mandated employer contribution (i.e. a
contribution not made in satisfaction of the employer‑sponsor’s
superannuation guarantee or award obligation).
Upon acceptance, the contribution will be taken to be a
mandated employer contribution and therefore subject to the minimum benefits
standards.
From this point, one of three circumstances may apply:
(a) the
trustee may become aware in the first year after the contribution was received
that the contribution is a non‑mandated employer contribution, and, if
this is the case, the trustee must treat the contribution as a non‑mandated
employer contribution; or
(b) the
trustee may become aware more than a year after the contribution was received
that the contribution is a non‑mandated employer contribution, and, if
this is the case, the trustee may continue to treat the contribution as a
mandated employer contribution instead of making corrections to reflect the
change; or
(c) the
trustee may never become aware that the contribution is a non‑mandated
employer contribution, and, if this is the case, the contribution will always
be taken to be a mandated employer contribution.
5.06 Certain
benefits rolled over or transferred to regulated superannuation funds taken to
be minimum benefits
(1) Subject to this
regulation, the following benefits are taken to be minimum benefits in a
regulated superannuation fund:
(a) benefits rolled
over or transferred to the regulated
superannuation fund;
(b) benefits allotted under Division 6.7 to an
interest in the regulated superannuation fund
held by, or created for, a receiving spouse.
(2) If:
(a) at least 1 year has elapsed since the fund
received the benefits; and
(b) the trustee:
(i) is satisfied that the benefits are
not in fact minimum benefits; and
(ii) decides not to continue to treat
the benefits as minimum benefits;
subregulation (1) ceases to apply to the benefits.
(3) If:
(a) less than 1 year has elapsed since the fund
received the benefits; and
(b) the trustee is satisfied that the benefits
are not in fact minimum benefits;
subregulation (1) ceases to apply to the benefits.
(4) If benefits that have been rolled over or
transferred to a regulated superannuation fund are taken under this regulation
to be minimum benefits, the amount of the minimum benefits as at any time is
the sum of:
(a) the benefits rolled over or transferred to
the fund; and
(b) the investment earnings on those benefits
down to that time;
less the costs applicable to those benefits down to that time.
(5) The trustee has power to make a decision of the kind
mentioned in subparagraph (2) (b) (ii) despite anything in the
governing rules of the fund.
(6) In this regulation:
benefits means benefits other than benefits
rolled over or transferred to a regulated superannuation fund from an RSA.
5.06A Benefits
rolled over or transferred from an RSA to regulated superannuation funds taken
to be minimum benefits
Benefits rolled over or transferred to a
regulated superannuation fund from an RSA are taken to be minimum benefits in
the regulated superannuation fund.
5.06B Minimum
benefits if new interest created, or benefits rolled over or transferred, under
Division 7A.2
(1) This regulation applies if:
(a) an interest (the original interest)
in an accumulation fund is subject to a payment split; and
(b) under Division 7A.2:
(i) a new interest is created in the
fund for the non‑member spouse; or
(ii) the transferable benefits of the
non‑member spouse are rolled over or transferred to another fund, an
EPSSS or an RSA.
(2) If subparagraph (1) (b) (i) applies, the
trustee may decide that all the benefits held in the original interest, and in
the new interest, immediately after the new interest is created are minimum benefits.
(3) If subparagraph (1) (b) (ii) applies, the
trustee may decide that all the benefits held in the original interest
immediately after the transferable benefits are rolled over or transferred are
minimum benefits.
Note Transferable benefits rolled over or
transferred to another regulated superannuation fund would be minimum benefits
in accordance with regulation 5.06.
(4) However, the trustee
must not make a decision mentioned in subregulation (2) or (3) if the decision
would have the effect of reducing the minimum benefits held by the other
members of the fund.
(5) If the trustee does
not make a decision mentioned in subregulation (2) or (3), the minimum benefits
held in the original interest are allocated between the member spouse and the
non‑member spouse in proportion to the split of benefits in the original
interest.
5.07 Minimum
benefits — approved deposit funds
A member’s minimum benefits in an approved deposit
fund are the amount of the member’s accumulated deposit in that fund.
Division 5.3 Treatment of minimum benefits
5.08 How
minimum benefits are to be treated
(1) For subsections
31 (1) and 32 (1) of the Act, it is a standard applicable to the
operation of regulated superannuation funds and approved deposit funds that the
trustee of a fund must ensure that a member’s minimum benefits in the fund are
maintained in the fund until the benefits are:
(a) cashed as benefits of the member, other than
for the purpose of the member’s temporary incapacity; or
(b) rolled over or transferred as benefits of the
member; or
(c) transferred, rolled over or allotted under
Division 6.7.
(2) Subregulation (1) does not apply in relation to an
amount of a member’s minimum benefits in an accumulation fund if:
(a) the amount
is attributable only to employer contributions (other than mandated employer
contributions); and
(b) there is a written agreement between the
member of the fund and the member’s employer that:
(i) was
entered into before the commencement of this subparagraph; and
(ii) requires
the employer to make the employer contributions (other than mandated employer
contributions) to the fund for the benefit of the member; and
(iii) specifies that if the member’s
employment with the employer ends at or after the end of a period specified in
the agreement, the employee is entitled to all of the amount; and
(iv) specifies that if the member’s
employment with the employer ends before the end of the specified period, the
member is entitled only to a proportion of the amount; and
(c) the member’s employment has ended before the
end of the period mentioned in subparagraph (b) (iii).
(3) In addition to subregulation (1), a trustee of an
accumulation fund may allow an amount of a member’s minimum benefits in the
fund to be cashed as benefits of the member if:
(a) the cashing of the benefits is for the
purpose of the member’s temporary incapacity; and
(b) the amount:
(i) is not attributable to the
member’s member‑financed benefits; and
(ii) is not attributable to the
member’s mandated employer‑financed benefits.
Division 5.5 Member‑protection standards
5.12 Interpretation
In this Division:
exit fee means a fee charged by a trustee of
a fund in relation to a payment of benefits in the fund, being a fee that the
trustee would not have charged if the payment had not been made.
member reporting period, in relation to a
fund, means the reporting period that applies under subsection 1017D (2)
of the Corporations Act 2001 and associated provisions.
5.13 Operating
standards — member protection
For the purposes of subsections 31 (1) and 32 (1)
of the Act, a requirement set out in this Division is a standard applicable to
the operation of regulated superannuation funds and approved deposit funds.
5.14 Member‑protection standards not to
apply to certain funds
(1) In this regulation:
unitised fund means a fund for which the
investment return is reflected in the price of units in the fund rather than
being credited to or debited against the accounts of the members.
(2) The member‑protection standards do not apply
to a unitised fund if:
(a) a single price is applicable both to the
buying and selling of units in the fund and all the administration costs of the
fund are reflected in that price; or
(b) separate prices are applicable, respectively,
to the buying and selling of units in the fund and:
(i) the price differential, also known
as the buy/sell
cost spread, is solely attributable to outgoings comprising:
(A) brokerage costs; and
(B) fees and charges charged
against a member’s benefits that are excluded from the definition of administration
costs under paragraphs (a), (b) and (c) of that definition in
subregulation 5.01 (1); and
(ii) the brokerage costs referred to in
sub‑subparagraph (i) (A), if any, are applied proportionally in
relation to all units in the fund; and
(iii) all the administration costs of
the fund, except for any brokerage costs applied in accordance with sub‑subparagraph
(i) (A) and subparagraph (ii), are reflected in both the buy price and the
sell price of the units; or
(c) the administration costs of the fund are not
wholly reflected in the price, or prices, of units in the fund but the benefits
of its members are protected in a way that is consistent with the member‑protection
standards.
(3) The member protection standards do not apply to a
fund that is not a unitised fund if all of the administration costs of the fund
are applied to each member in direct proportion to:
(a) the investment return credited to, or
debited against, the member; or
(b) the member’s benefits.
5.15 Member‑protection
standards not to apply to certain protected members
If:
(a) a member of a fund is a protected member at
the end of a member reporting period; and
(b) the trustee of the fund has a reasonable
expectation (in accordance with regulation 7.9.24 of the Corporations
Regulations 2001 and subsections 7.1 (12) to (15) of Part 7 of
Schedule 10A to the Corporations Regulations 2001) that the member will
have a withdrawal benefit of at least $1,500 within 12 months after the end of
that member reporting period; and
(c) his or her withdrawal benefits reach $1,500
within 12 months after the end of that member reporting period;
he or she is taken not to have been subject to the member‑protection
standards from the beginning of that member reporting period until the end of
that period of 12 months.
Note See regulation 2.26B in relation to
protected members whose benefits are reasonably expected to reach $1,500 within
the period of 12 months after the end of a member reporting period.
5.15B Member‑protection
standards taken not to have applied to certain members
(1) If:
(a) before 1 July 1995, the trustee of a
regulated superannuation fund has formed the intention:
(i) to apply, on behalf of a member of
the fund, to an eligible rollover fund for the issue to the member of a
superannuation interest in the latter fund; or
(ii) not to protect the benefits of a
member; and
(b) the trustee keeps a record of having formed
that intention, being a record that identifies the member; and
(c) the benefits of the member are paid out of
the fund before 1 October 1995; and
(d) the trustee has not charged an exit fee in
respect of the payment of those benefits out of the fund;
the member‑protection standards are taken not to have applied
to the member in respect of his or her membership of the fund during the period
ending on the date on which the last of the member’s benefits are paid out of
the fund.
(2) In subregulation (1), a reference to payment of
benefits out of a fund includes:
(a) rolling over or transferring the benefits;
and
(b) cashing the benefits; and
(c) any combination of rolling over,
transferring and cashing the benefits.
5.15C Member‑protection
standards not to apply to pensions
The member‑protection standards do not apply
to any part of a member’s benefits which has commenced to be taken in the form
of a pension.
5.15D Member‑protection
standards not to apply to traditional life insurance policies
The member‑protection standards do not apply
to a part of a member’s benefits that is wholly determined by a life insurance
policy within the meaning of the Life Insurance Act 1995 if:
(a) the policy includes an investment component;
and
(b) the premium is not dissected (whether by
reference to the investment component or otherwise); and
(c) the sum insured, together with bonuses (if
any), is payable only upon:
(i) the death of the life insured; or
(ii) the occurrence of the earlier of
the following events:
(A) the death of the life
insured; or
(B) the attainment by the
life insured of the age specified in the policy.
5.16 Application
of member‑protection standards to sub‑fund
(1) Subject to subregulation (2), the trustee of a fund
may treat a sub‑fund within the fund as a fund for the purposes of the
member‑protection standards if the sub‑fund satisfies the following
conditions (otherwise than for the purposes of winding up):
(a) the sub‑fund has separately
identifiable assets and separately identifiable beneficiaries; and
(b) the interest of each beneficiary of the sub‑fund
is determined by reference only to the conditions governing that sub‑fund;
and
(c) there is no transfer of assets, benefits or
money between the sub‑fund and another sub‑fund without a transfer
of a corresponding beneficial interest; and
(d) the insurance and administration costs of the
sub‑fund are attributable only to the sub‑fund.
(2) The trustee may not treat a sub‑fund as a fund
if the purpose of doing so is to circumvent the member‑protection
standards.
5.17 Member‑protection
standards
(1) This regulation applies in relation to a member of a
fund who, on or after 1 July 1995, is a protected member.
(2) Subject to subregulation (4), the sum charged as
administration costs in respect of a relevant member reporting period against
the minimum benefit component of the benefits of a member to whom this
regulation applies must not exceed the investment return credited to, or
debited against, the member’s minimum benefits for that period.
(3) For subregulation (2) and subject to subregulation
(4), a member reporting period for a protected member is a relevant member
reporting period if:
(a) the period ends after 30 June 1995; and
(b) at the end of the period, and subject to any
adjustment affecting the member’s benefits (net of any exit fee) made by the
trustee in respect of the period, the member is a protected member.
(4) For subregulations (2) and (3), if a member
reporting period begins before and ends after 1 July 1995, a trustee may treat
only the part of that period beginning on 1 July 1995 as being a relevant member
reporting period.
(5) If, under Division 5.6, a member elects to waive
member protection, the last relevant member reporting period in relation to
that member is taken to end at the end of the day when, under regulation 5.22,
the member‑protection standards cease to apply to the member.
(6) Subregulation (2)
does not apply to a member (except for a member of a fund that is a capital
guaranteed fund within the meaning of the Corporations Regulations 2001)
if, in a member reporting period:
(a) the total of the administration costs that
would be charged to members of a fund but for this regulation is greater than
the total investment return that would be credited to or debited against
members of the fund but for this regulation in respect of that period; and
(b) the apportionment of those costs between
members is carried out in a fair and equitable manner.
(8) For the purposes of this regulation, an exit fee
other than an exit fee of an amount equal to the exit fee applicable to the
member’s benefit at 30 June 1995 is taken to be charged against the relevant
member’s minimum benefit.
(9) For the purposes of paragraph (6) (b), an
apportionment of costs is taken to be fair and equitable only if:
(a) each member of the fund is charged no more
than:
(i) the amount that the member would
be charged if all administration costs charged against member’s benefits were
distributed in direct proportion to:
(A) the investment return
credited to, or debited against, the member’s benefits; or
(B) the
member’s benefits; or
(ii) the investment return credited to
the member’s benefits, plus $10; or
(b) each protected member of the fund is charged
no more than an amount equal to the investment return credited to the member’s
benefits, plus $10.
(10) For the purposes of this regulation, a member’s
benefits are taken to be composed wholly of mandated employer‑financed
benefits except for:
(a) the portion (if any) of the benefits that:
(i) arose in relation to contributions
made before 1 July 1995; and
(ii) the trustee reasonably believes
are not mandated employer‑financed benefits; and
(b) the portion (if any) of the benefits that:
(i) arose in relation to contributions
made on or after 1 July 1995; and
(ii) the trustee knows are not mandated
employer‑ financed benefits.
(11) Despite anything in this regulation, a trustee of a
fund may protect the benefits of a member from an earlier date than this
regulation requires.
5.18 Costs
not to be deferred
If the trustee of a fund would charge costs to a
member in respect of a member reporting period but for regulation 5.17, the
trustee must not charge those costs to the member in a future member reporting
period, whether in combination with other costs or not.
Division 5.6 Existing personal superannuation members
5.19 Interpretation
In this Division:
existing personal superannuation member means
a member of a regulated superannuation fund who:
(a) joined the fund before 1 July 1995; and
(b) at the time he or she joined the fund, was
not a person in respect of whom there was in effect a contribution arrangement
of the kind referred to in subsection 16 (5) of the Act (which deals with
the definition of standard employer‑sponsored member).
5.20 Operating standards — existing
personal superannuation members
For the purposes of subsection 31 (1) of the
Act, a requirement set out in this Division is a standard applicable to the
operation of regulated superannuation funds.
5.21 Trustee may offer election to existing
personal superannuation members
(1) The trustee of a regulated superannuation fund that
has existing personal superannuation members may offer in writing to each of
those members the right to elect never to be treated by the fund as if he or
she were a protected member.
(2) If the trustee offers a member the right to elect
never to be treated as a protected member, the trustee:
(a) must also offer the member the right to
elect to have the member’s benefits paid to an entity of the member’s choice;
and
(b) may also offer the member the right to elect
to have the member’s benefits paid in any other way.
Note The trustee also has the power,
under Part 24 of the Act, to pay benefits to an eligible rollover fund.
(3) The trustee may specify an entity (in this
regulation called the default entity) that will be taken to be
the member’s choice of entity if:
(a) a member elects to have benefits paid to
another entity but does not specify the entity; or
(b) a member elects to have benefits paid to
another entity but that other entity refuses to accept the benefits.
(4) The default entity must be:
(a) an entity to which the member‑protection
standards relating to the protection of protected members apply; or
(b) an eligible rollover fund.
(5) A member to whom a trustee offers the right to make
an election under subregulations (1) and (2) is not obliged to elect in favour
of any of the courses set out in that subregulation.
(6) For the purposes of this Division, if:
(a) a member specifies an entity to which his or
her benefits are to be paid, but that entity refuses to accept the payment; or
(b) the member elects to have his or her benefits
paid to another entity, but does not specify the entity;
the member is taken to have elected to have his or her benefits
paid to the default entity.
(7) If a trustee offers members of the fund the right to
make an election, the trustee must provide each member to whom the election is
offered with the following information:
(a) the contact details (within the meaning of
the Corporations Regulations 2001) of the default entity, if any;
(b) a statement that:
(i) states that a member is not
obliged to make an election in favour of any of the courses offered; and
(ii) sets out the effect of not making
an election; and
(iii) sets out the effect of making an
election in favour of each of the courses offered; and
(iv) sets out the circumstances in which
the member will be taken to have elected to have his or her benefits paid to
the default entity;
(c) the amount, or, subject to subregulation
(8), the approximate amount, of the member’s benefits in the fund.
(8) A fund may inform a member under paragraph
(7) (c) of the approximate amount of the member’s benefits if, at the time
the information is to be given, the trustee of the fund cannot determine the
exact amount of the member’s benefits in the fund.
5.22 What happens if the member waives member
protection?
(1) If under regulation
5.21 a member of a fund elects to waive member protection, the member‑protection
standards cease to apply to the member:
(a) if the waiver takes place before 1 October
1995 — from 1 July 1995; or
(b) in any other case — from the date of the
waiver.
Note See subregulation 5.17 (5) in
regard to the end of the last relevant member reporting period in this case.
(2) If under regulation 5.21 a member of a fund elects
to waive member protection, the waiver ceases to have effect when the member
ceases to be a member of the fund.
5.23 What happens if the member elects to have
benefits paid out of the fund?
If a member of a fund elects to have his or her benefits
paid out of the fund under this Division, and the payment takes place before 1 October
1995, the member‑protection standards are taken never to have applied in
relation to the member’s membership of the fund.
5.24 What
happens if the trustee pays benefits paid out of the fund?
If:
(a) the trustee of a fund has written to a
member offering the right to elect under regulation 5.21; and
(b) the member does not elect to waive member
protection; and
(c) the trustee pays benefits of the member out
of the fund;
the trustee must not charge an exit fee in respect of the payment.
Part 6 Payment
standards
Division 6.1 Introductory
Subdivision
6.1.1 General interpretation
6.01 Interpretation
(1) Subject to subregulation (2), expressions used in
this Part that are defined for the purposes of Part 5 have the same meanings
respectively as in that Part.
(2) In this Part and in Schedule 1, unless the contrary
intention appears:
cashing restriction, in relation to a condition of release, means a cashing
restriction specified in column 3 of the item in Schedule 1 that mentions the
condition of release.
changeover day, in relation to a type B
member of a fund, means the changeover day that was fixed for the class of
members of the fund in which the member is included.
commencement day means:
(a) in relation to a regulated superannuation
fund, the later of:
(i) the first day of the 1994‑95
year of income of the fund; or
(ii) the day on which the trustee or
trustees of the fund make an election under section 19 of the Act; and
(b) in relation to an approved deposit fund:
(i) if the first day of the 1994‑95
year of income of the fund is on or after 1 July 1994 — the first day of
that year of income; or
(ii) if the first day of that year of
income is before 1 July 1994 — the earlier of:
(A) 1 July 1994; or
(B) the day on which the
fund became an approved deposit fund.
Commonwealth income
support payment means:
(a) an income support supplement, service
pension or social security pension as defined in subsection 23 (1) of the Social
Security Act 1991; or
(b) a social security benefit as defined in that
subsection, other than:
(i) an austudy payment; or
(ii) a youth allowance paid to a person
who is undertaking full‑time study; or
(c) a drought relief payment under the Farm
Household Support Act 1992 as in force immediately before the commencement
of the Farm Household Support Amendment (Restart and Exceptional
Circumstances) Act 1997; or
(d) an exceptional circumstances relief payment
under the Farm Household Support Act 1992; or
(e) a payment of salary or wages made under the
employment scheme of the Commonwealth that is known as the Community
Development Employment Projects Scheme.
compassionate ground, in relation to the
release of a member’s preserved benefits, or restricted non‑preserved
benefits, in a superannuation entity, means a ground listed in subregulation
6.19A (1).
condition of release means a condition of
release specified in Column 2 of Schedule 1, and a member of a fund is taken to
have satisfied a condition of release if the event specified in that condition
has occurred in relation to the member.
eligible temporary resident visa
means a visa:
(a) of one of the subclasses mentioned in Part 1
of Schedule 1AB, within the meaning of Part 2 of Schedule 1 to the Migration
Regulations 1994; or
(b) that is a special purpose visa mentioned in
Part 2 of Schedule 1AB, declared under subparagraph 33 (2) (b) (ii)
of the Migration Act 1958;
that is held by a person who is not a New Zealand citizen.
Note Some of the visas mentioned in
Schedule 1AB no longer exist. However, they remain relevant for regulations
6.20A, 6.20B and 6.24A.
indexed, in relation to a benefit, means
indexed in accordance with section 159SG of the Tax Act (as in force before 1 July 2007), modified so that subsection (1)
reads as follows:
‘(1) The benefit as indexed for each year of
income is:
(a) in relation to the year of income
in which occurs the day on which a benefit was required to have been calculated
or was received by the fund — the amount of the benefit that was
calculated or received; or
(b) in relation to a later year of
income — the amount calculated by multiplying the benefit for the
immediately preceding year of income by the indexation factor worked out in
accordance with subsection (2) for the later year of income.’
lump sum, in this Part but not in Schedule 1,
includes an asset.
non‑commutable allocated annuity means
an annuity provided under a contract that:
(a) meets the standards of subregulation
1.05 (4); and
(b) ensures that payments of benefits are made
only in accordance with the rules set out in regulations 6.16, 6.18, 6.19 and
6.22A, as if:
(i) the annuity were a regulated
superannuation fund; and
(ii) the annuitant were a member of the
fund; and
(iii) the annuity provider were a
trustee of the fund; and
(c) ensures that, if the annuity is commuted,
the resulting superannuation lump sum cannot
be cashed unless:
(i) the purpose of the commutation
is:
(A) to cash an unrestricted
non‑preserved benefit; or
(B) to pay a superannuation
contributions surcharge; or
(C) to give effect to an
entitlement of a non‑member spouse under a payment split; or
(D) to ensure that a
payment may be made for the purpose of giving effect to a release authority
under:
(I) section
292‑415 of the Income Tax Assessment Act 1997; or
(II) section
292‑80C of the Income Tax (Transitional Provisions) Act 1997; or
(ii) before commutation, the annuitant
has satisfied a condition of release in respect of which the cashing restriction
for preserved benefits and restricted non‑preserved benefits is nil; or
(iii) the purpose of the commutation is
to satisfy an obligation to pay an amount to the Commissioner of Taxation under
subsection 20F (1) of the Superannuation (Unclaimed Money and Lost
Members) Act 1999.
non‑commutable allocated pension means
a pension provided under rules of a superannuation fund that:
(a) meet the standards of subregulation
1.06 (4); and
(b) ensure that, if the pension is commuted, the
resulting superannuation lump sum cannot be cashed unless:
(i) the purpose of the commutation is:
(A) to cash an unrestricted
non‑preserved benefit; or
(B) to pay a superannuation
contributions surcharge; or
(C) to give effect to an
entitlement of a non‑member spouse under a payment split; or
(D) to ensure that a
payment may be made for the purpose of giving effect to a release authority
under:
(I) section
292‑415 of the Income Tax Assessment Act 1997; or
(II) section
292‑80C of the Income Tax (Transitional Provisions) Act 1997; or
(ii) before commutation, the pensioner
has satisfied a condition of release in respect of which the cashing
restriction for preserved benefits and restricted non‑preserved benefits
is nil; or
(iii) the purpose of the commutation is
to satisfy an obligation to pay an amount to the Commissioner of Taxation under
subsection 20F (1) of the Superannuation (Unclaimed Money and Lost
Members) Act 1999.
non‑commutable annuity means an annuity
provided under a contract that:
(a) meets the standards of subregulation
1.05 (2), (9) or (10); and
(b) ensures that payments of benefits are made
only in accordance with the rules set out in regulations 6.16, 6.18, 6.19 and
6.22A, as if:
(i) the annuity were a regulated
superannuation fund; and
(ii) the annuitant were a member of the
fund; and
(iii) the annuity provider were a
trustee of the fund; and
(c) ensures that, if the annuity is commuted
under subparagraph 1.05 (2) (f) (i), (9) (h) (i) or (10) (d) (i), the resulting
superannuation lump sum cannot be cashed
unless:
(i) the purpose of the commutation is
to cash an unrestricted non‑preserved benefit; or
(ii) before commutation, the annuitant
has satisfied a condition of release in respect of which the cashing
restriction for preserved benefits and restricted non‑preserved benefits
is ‘Nil’.
non‑commutable income stream means a
benefit that:
(a) cannot be commuted; and
(b) is paid at least monthly; and
(c) does not have a residual capital value; and
(d) is such that the total amount paid each month
is fixed or varies only:
(i) for the purpose of complying with
the Act and these regulations; and
(ii) during any period of 12 months by
a rate not exceeding either:
(A) 5% per annum; or
(B) the rate of increase in
the last Consumer Price Index (All Capital Cities) for a quarter to be
published by the Australian Statistician before the end of that period of 12
months compared with the Consumer Price Index (All Capital Cities) published
for the same quarter in the preceding year.
non‑commutable pension means a pension
provided under rules of a superannuation fund that:
(a) meet the standards of subregulation 1.06
(2), (7) or (8); and
(b) ensure that, if the pension is commuted
under subparagraph 1.06 (2) (e) (i), (7) (g) (i) or (8) (d) (i), the resulting superannuation
lump sum cannot be cashed unless:
(i) the purpose of the commutation is
to cash an unrestricted non‑preserved benefit; or
(ii) before commutation, the pensioner
has satisfied a condition of release in respect of which the cashing
restriction for preserved benefits and restricted non‑preserved benefits
is ‘Nil’.
permanent incapacity, in relation to a member, means ill‑health (whether
physical or mental), where the trustee is reasonably satisfied that the member
is unlikely, because of the ill‑health, to engage in gainful employment
for which the member is reasonably qualified by education, training or
experience
permanent resident means a holder of a
permanent visa under the Migration Act 1958 that has not ceased to be in
effect.
preservation age means:
(a) for a person born before
1 July 1960 — 55 years; or
(b) for a person born during the year
1 July 1960 to 30 June 1961 — 56 years; or
(c) for a person
born during the year 1 July 1961 to 30 June 1962 — 57
years; or
(d) for a person born during the year
1 July 1962 to 30 June 1963 — 58 years; or
(e) for a person born during the year
1 July 1963 to 30 June 1964 — 59 years; or
(f) for a person born after 30 June 1964 —
60 years.
restricted non‑preserved contributions
means undeducted contributions (within the meaning of subregulation (6)) of a
member other than contributions that were preserved in satisfaction of
requirements of the Tax Act, the OSS Laws the Superannuation Industry
(Supervision) (Transitional Provisions) Regulations, the RSA Regulations or
these regulations leading to income tax concessions.
retirement has the meaning given by
subregulation (7).
severe financial hardship has the meaning
given by subregulation (5).
temporary incapacity, in relation to a member
who has ceased to be gainfully employed (including a member who has ceased
temporarily to receive any gain or reward under a continuing arrangement for
the member to be gainfully employed), means ill‑health (whether physical
or mental) that caused the member to cease to be gainfully employed but does
not constitute permanent incapacity.
temporary resident means a holder of a
temporary visa under the Migration Act 1958.
terminal medical condition has the meaning
given by regulation 6.01A.
transition to retirement
income stream means:
(a) an annuity provided under a contract that:
(i) is a
contract:
(A) to
which paragraph 1.05 (11A) (a) applies; and
(B) that
meets the standards of subregulation 1.05 (11A); and
(ii) allows total payments (excluding
payments by way of commutation, but including payments under a payment split)
made in a financial year to amount to no more than 10% of the annuity account
balance:
(A) on 1 July in the
financial year in which the payment is made; or
(B) if that year is the year
in which the annuity commences — on the commencement day;
unless the annuitant has satisfied
a condition of release in respect of which the cashing restriction for
preserved benefits and restricted non‑preserved benefits is ‘Nil’; and
(iii) complies
with paragraphs (b) and (c) of the definition of non‑commutable
allocated annuity, as if it were such an annuity; or
(b) a pension provided from a superannuation
fund, the rules of which:
(i) are
rules:
(A) to
which paragraph 1.06 (9A) (a) applies; and
(B) that
meet the standards of subregulation 1.06 (9A); and
(ii) allow total payments (excluding
payments by way of commutation but including payments under a payment split)
made in a financial year to amount to no more than 10% of the pension account
balance:
(A) on 1 July in the
financial year in which the payment is made; or
(B) if that year is the year
in which the pension commences — on the commencement day;
unless the pensioner has satisfied
a condition of release in respect of which the cashing restriction for
preserved benefits and restricted non‑preserved benefits is ‘Nil’; and
(iii) comply
with paragraph (b) of the definition of non‑commutable
allocated pension, as if it were such a pension.
transitional period, in relation to a
superannuation fund, means the period beginning at the beginning of the fund’s
1994‑1995 year of income and ending:
(a) in the case of a public sector
superannuation scheme — at the end of the day when the scheme became an
exempt public sector superannuation scheme; or
(b) in any other case — at the end of the
day when the trustee of the fund lodges an election under section 19 of the
Act.
type A member means a member of a regulated
superannuation fund included in a class of members for which no changeover day,
fixed under these regulations as in force before 30 June 1998, was reached
before 30 June 1998 in relation to that fund.
type B member
means a member of a regulated superannuation fund included in a class of
members for which a changeover day, fixed under these regulations as in force
before 30 June 1998, was reached before 30 June 1998 in relation to that fund.
(5) For the purposes of Schedule 1, a person is taken to
be in severe financial hardship if:
(a) the trustee of a superannuation entity is
satisfied:
(i) based on written evidence provided
by at least one Commonwealth department or agency responsible for administering
a class of Commonwealth income support payments, that:
(A) the person has received
Commonwealth income support payments for a continuous period of 26 weeks; and
(B) the person was in
receipt of payments of that kind on the date of the written evidence; and
(ii) that the person is unable to meet
reasonable and immediate family living expenses; or
(b) the person has reached the age that is the
person’s preservation age plus 39 weeks and the trustee of a superannuation
entity is satisfied:
(i) based on written evidence provided
by at least one Commonwealth department or agency responsible for administering
a class of Commonwealth income support payments — that the person received
Commonwealth income support payments for a cumulative period of 39 weeks
after the person reached the person’s preservation age; and
(ii) that the person was not gainfully
employed on a full‑time, or part‑time, basis on the date of the
application for cashing of his or her preserved benefits, or restricted non‑preserved
benefits, in the entity.
(5A) The written evidence provided for by paragraph
(5) (a) is of no effect if it is dated more than 21 days before the date
of the person’s application to the trustee for cashing of his or her preserved
benefits or restricted non‑preserved benefits.
(6) Amounts to the credit of a member (except eligible
spouse contributions) in a fund are undeducted contributions if:
(a) the amounts are
undeducted contributions within the meaning that was given, before 1 July 2007,
by subsection 27A (1) of the Tax Act; or
(b) for any other amounts — the amounts
comprise member contributions:
(i) made
after 30 June 1983 in order to obtain superannuation benefits (within the
meaning of the Tax Act); and
(ii) in
respect of which no deduction is allowable or has been allowed to the member
under the former section 82AAT of the Tax Act.
(7) For the purposes of Schedule 1, the retirement of a
person is taken to occur:
(a) in the case of a person who has reached a
preservation age that is less than 60 — if:
(i) an arrangement under which the
member was gainfully employed has come to an end; and
(ii) the trustee is reasonably
satisfied that the person intends never to again become gainfully employed,
either on a full‑time or a part‑time basis; or
(b) in the case of
a person who has attained the age of 60 — an arrangement under which the
member was gainfully employed has come to an end, and either of the following
circumstances apply:
(i) the
person attained that age on or before the ending of the employment; or
(ii) the
trustee is reasonably satisfied that the person intends never to again become
gainfully employed, either on a full‑time or a part‑time basis.
(8) A reference in this Part to preserved
benefits, restricted non‑ preserved benefits, restricted
non‑preserved contributions, unrestricted non‑preserved
benefits and post‑65 employer‑ financed benefits
includes benefits, or contributions (as the case may be), rolled over, or
transferred, from an RSA.
6.01A Meaning
of terminal medical condition
For Schedule 1, a terminal medical
condition exists in relation to a person at a particular time if the
following circumstances exist:
(a) two registered medical practitioners have
certified, jointly or separately, that the person suffers from an illness, or
has incurred an injury, that is likely to result in the death of the person
within a period (the certification period) that ends not more
than 12 months after the date of the certification;
(b) at least one of the registered medical
practitioners is a specialist practicing in an area related to the illness or
injury suffered by the person;
(c) for each of the certificates, the
certification period has not ended.
Subdivision 6.1.2 Preserved benefits
6.02 Preserved
benefits in regulated superannuation funds — before 1 July 1999
Type A members before 1 July 1999; type B members before
changeover day
(1) Subject to regulations 6.06 and 6.12 and to Subdivision
6.1.5, the amount of preserved benefits in a regulated superannuation fund:
(a) for a type A member at any time during the
period commencing on the commencement day and ending immediately before 1 July
1999; or
(b) for a type B member at any time during the
period commencing on the commencement day and ending immediately before the
changeover day;
is the amount required to be preserved under the OSS laws as
applied in accordance with subregulation (2).
(2) For
subregulation (1), despite the repeal of sections of the Occupational
Superannuation Standards Act 1987 by the Occupational Superannuation
Standards Amendment Act 1993, the OSS laws are taken to have continued in
force, subject to the modifications set out in Schedule 2, in relation to
regulated superannuation funds as if the references in the OSS laws (as so
modified) to superannuation funds were references to regulated superannuation
funds within the meaning of these regulations.
Type B members on and after changeover day
(3) Subject to regulation 6.12 and to Subdivision
6.1.5, the amount of a type B member’s preserved benefits in a regulated
superannuation fund at any time on or after the changeover day and before 1
July 1999 is the amount of the member’s total benefits in the fund less the sum
of:
(a) the amount of the member’s restricted non‑preserved
benefits in the fund as defined by regulation 6.07; and
(b) the amount of the member’s unrestricted non‑preserved
benefits in the fund as defined by regulation 6.10.
6.03 Preserved
benefits in regulated superannuation funds — on and after 1 July 1999
Subject to regulation 6.12 and to Subdivision
6.1.5, the amount of a member’s preserved benefits in a regulated
superannuation fund at any time on or after 1 July 1999 is the amount of the
member’s total benefits in the fund less the sum of:
(a) the amount of the member’s restricted non‑preserved
benefits in the fund as defined by regulation 6.08; and
(b) the amount of the member’s unrestricted non‑preserved
benefits in the fund as defined by regulation 6.10.
6.05 Preserved
benefits in approved deposit funds
The amount of a member’s preserved benefits in an
approved deposit fund on or after the commencement day is the amount of the
member’s total benefits in the fund less the amount of the member’s
unrestricted non‑preserved benefits in the fund as defined by regulation
6.11.
6.06 Effect
of rollover or transfer on preserved benefits
Subject to regulation 6.12 and to Subdivision
6.1.5, a member’s benefits in a regulated superannuation fund or an approved
deposit fund (the transferee fund) that were preserved benefits
in the source from which they were received continue to be preserved benefits
in the transferee fund.
Subdivision
6.1.3 Restricted non‑preserved benefits
Note Approved deposit funds do not have
restricted non‑preserved benefits.
6.07 Restricted
non‑preserved benefits in regulated superannuation funds — before 1
July 1999
Type A members before 1 July 1999;
type B members before changeover day
(1) Subject to regulations
6.09 and 6.12 and to Subdivision 6.1.5, the amount of restricted non‑preserved
benefits in a regulated superannuation fund:
(a) for a type A member at any time during the
period commencing on the commencement day and ending immediately before 1 July
1999; or
(b) for a type B member at any time during the
period commencing on the commencement day and ending immediately before the
changeover day;
is the amount of the member’s total benefits in the fund, less the
sum of:
(c) the amount of the member’s preserved benefits
in the fund as defined by regulation 6.02; and
(d) the amount of the member’s unrestricted non‑preserved
benefits in the fund as defined by regulation 6.10.
Type B members on and after
changeover day
(2) Subject to regulation 6.12 and to Subdivision 6.1.5,
the amount of a type B member’s restricted non‑preserved benefits in a
regulated superannuation fund at any time on or after the changeover day and
before 1 July 1999 is the greatest of the following amounts:
(a) the total of:
(i) the indexed amount of the member’s
restricted non‑preserved benefits (as defined by subregulation (1)) in
the fund that would be payable to the member on the changeover day if the
member resigned from employment on that day; and
(ii) the indexed amount of the member’s
restricted non‑preserved benefits received by the fund from another
regulated superannuation fund, an RSA or an EPSSS on or after the changeover
day that are subject to indexation in the fund;
(b) the total of:
(i) the indexed amount of the member’s
restricted non‑preserved benefits (as defined by subregulation (1)) in
the fund on the changeover day that would be payable to the member if the
member were retrenched from employment that day; and
(ii) the
indexed amount of the member’s restricted non‑preserved benefits received
by the fund from another regulated superannuation fund, an RSA or an EPSSS on
or after the changeover day that are subject to indexation in that other fund,
RSA or EPSSS;
(c) the amount of the member’s restricted non‑preserved
contributions in the fund.
(3) Subject to regulation
6.12 and to Subdivision 6.1.5, a type B member’s benefits in a regulated
superannuation fund (the transferee fund) that:
(a) were rolled over or transferred from another
regulated superannuation fund, an RSA or an EPSSS; and
(b) were indexed amounts of restricted non‑preserved
benefits in that other fund, RSA or EPSSS;
continue to be subject to indexation in
the transferee fund.
(4) Subject to regulation
6.12 and to Subdivision 6.1.5, a type B member’s benefits in a regulated
superannuation fund (the transferee fund) that:
(a) were rolled over or transferred from another
regulated superannuation fund, an RSA or an EPSSS; and
(b) were restricted non‑preserved
contributions in that other fund, RSA or EPSSS;
continue to be restricted non‑preserved
contributions in the transferee fund.
(5) The references in this regulation to indexation
apply subject to regulation 6.14.
6.08 Restricted
non‑preserved benefits in regulated superannuation funds — on and
after 1 July 1999
(1) Subject to regulations
6.09 and 6.12 and to Subdivision 6.1.5, the amount of a member’s
restricted non‑preserved benefits in a regulated superannuation fund at
any time on or after 1 July 1999 is the sum of the following amounts:
(a) either:
(i) for a type A member who is a
defined benefit member and for whom the trustee of the regulated superannuation
fund chooses to apply this subparagraph — the greater of the amounts of
restricted non‑preserved benefits in the fund, worked out under subregulation
6.07 (1), that would be payable to the member on 1 July 1999 if, on 1
July 1999, the member:
(A) resigned from
employment; or
(B) was retrenched from
employment; or
(ii) for a member to whom subparagraph
(i) does not apply — the member’s restricted non‑preserved benefits
in the fund on 30 June 1999, worked out under regulation 6.07; and
(b) the member’s restricted non‑preserved
benefits received by the fund from another regulated superannuation fund, an
RSA or an EPSSS on and after 1 July 1999.
(2) However, if:
(a) on or after 1 July 1999, a deduction is
allowed for the member under the former section 82AAT
of the Income Tax Assessment Act 1936 for a member contribution made
before 1 July 1999; and
(b) the benefits arising from the contribution
were previously allocated to restricted non‑preserved benefits;
the benefits are taken to be preserved benefits.
6.09 Effect
of rollover or transfer on restricted non‑preserved benefits
Subject to regulation 6.12 and to Subdivision
6.1.5, a member’s benefits in a regulated superannuation fund that were
restricted non‑preserved benefits in the source from which they were
received continue to be restricted non‑preserved benefits.
Subdivision 6.1.4 Unrestricted non‑preserved
benefits
6.10 Unrestricted
non‑preserved benefits — regulated superannuation funds
(1) Subject to Subdivision 6.1.5, the amount of a
member’s unrestricted non‑preserved benefits in a regulated
superannuation fund is the sum of:
(a) the amount of benefits of the member that
have become unrestricted non‑preserved benefits in the fund in accordance
with regulation 6.12; and
(b) the amounts specified in subregulation (2)
that the fund receives in respect of the member on or after the commencement
day, and that were received by the regulated superannuation fund before 1 July
2004; and
(c) the amount of unrestricted non‑preserved
benefits received by the fund in respect of the member on or after the
commencement day; and
(d) the amount of any investment earnings for the
period before 1 July 1999 on the amounts mentioned in paragraphs (a), (b) and
(c).
(2) The amounts mentioned in paragraph (1) (b) are
amounts (other than an amount that is a capital gains tax exempt component)
that:
(a) will be taken by section 27D of the Tax Act, as in force before 1 July 2007, to have been
expended out of eligible termination payments within the meaning of that
section; and
(b) have been received from sources other than:
(i) superannuation funds; or
(ii) approved
deposit funds within the meaning of:
(A) the
Act; or
(B) the Occupational
Superannuation Standards Act 1987 as in force immediately before
the commencement of section 5 of the Occupational Superannuation Standards
Amendment Act 1993; or
(iii) deferred annuities within the
meaning of:
(A) this Part; or
(B) the Occupational
Superannuation Standards Regulations; or
(iv) RSAs.
(3) However, if:
(a) on or after 1 July 1999, a deduction is
allowed for the member under the former section 82AAT
of the Income Tax Assessment Act 1936 for a member contribution made
before 1 July 1999; and
(b) the benefits arising from the contribution
were previously allocated to restricted non‑preserved benefits that
became unrestricted non‑preserved benefits under subregulation
6.12 (2);
the benefits are taken to be preserved benefits.
6.11 Unrestricted
non‑preserved benefits — approved deposit funds
(1) Subject to Subdivision 6.1.5, the amount of a
member’s unrestricted non‑preserved benefits in an approved deposit fund
is the sum of:
(a) the amount of the member’s benefits in the
fund at the end of the day immediately before the commencement day less the
amount of the member’s benefits in the fund that were required to be preserved
by regulation 21 of the Occupational Superannuation Standards Regulations; and
(b) the amount of benefits of the member that
have become unrestricted non‑preserved benefits in the fund in accordance
with regulation 6.12; and
(c) the amounts specified in subregulation (2)
that the fund receives in respect of the member on or after the commencement
day, and that were received by the approved deposit fund before 1 July 2004;
and
(d) the amount of unrestricted non‑preserved
benefits received by the fund in respect of the member on or after the
commencement day; and
(e) the amount of any investment earnings for
the period before 1 July 1999 on the amounts mentioned in paragraphs (a), (b),
(c) and (d).
(2) The amounts mentioned in paragraph (1) (c) are
amounts (other than an amount that is a capital gains tax exempt component)
that:
(a) will be taken by section 27D of the Tax Act, as in force before 1 July 2007, to have been
expended out of eligible termination payments within the meaning of that
section; and
(b) have been
received from sources other than:
(i) superannuation funds; or
(ii) approved deposit funds within the
meaning of:
(A) the Act; or
(B) the Occupational
Superannuation Standards Act 1987 as in force immediately before
the commencement of section 5 of the Occupational Superannuation Standards
Amendment Act 1993; or
(iii) deferred annuities within the
meaning of:
(A) this Part; or
(B) the Occupational
Superannuation Standards Regulations; or
(iv) RSAs.
6.12 Movement
of benefits between categories by satisfaction of conditions of release
(1) If:
(a) a member of a regulated superannuation fund
or an approved deposit fund satisfies a condition of release; and
(b) the relevant cashing restriction in respect
of preserved benefits is ‘Nil’;
the member’s preserved benefits in the fund at that time cease to
be preserved benefits and become unrestricted non‑ preserved benefits.
(2) If:
(a) a member of a regulated superannuation fund
satisfies a condition of release; and
(b) the relevant cashing restriction in respect
of restricted non‑preserved benefits is ‘Nil’;
the member’s restricted non‑preserved benefits in the fund at
that time cease to be restricted non‑preserved benefits and become
unrestricted non‑preserved benefits.
(3) This regulation has effect subject to Subdivision
6.1.5.
6.13 Effect of rollover or transfer on
unrestricted non‑preserved benefits
Subject to Subdivision 6.1.5, a member’s benefits
in a regulated superannuation fund or an approved deposit fund (the
transferee fund) that were unrestricted non‑preserved benefits in
the source from which they were received continue to be unrestricted non‑preserved
benefits in the transferee fund.
Subdivision
6.1.5 Miscellaneous
6.14 Indexation
(1) Benefits that are referred to in this Division as
indexed may be aggregated for the purpose of that indexation.
(2) This regulation has no effect after 30 June
1999.
6.15 Contributions
and benefits taken to be preserved benefits
(1) Contributions made, or
benefits rolled over or transferred, to a regulated superannuation fund or an
approved deposit fund are taken to be preserved benefits for the purposes of
this Division unless and until the trustee is satisfied that they are not
preserved benefits.
(2) Benefits rolled over, transferred or allotted under
Division 6.7 to an interest in a regulated
superannuation fund held by, or created for, a receiving spouse are
taken to be preserved benefits for the purposes of this Division.
6.15A Certain
benefits taken to be unrestricted non‑preserved benefits
(1) Benefits in a fund are unrestricted non‑preserved
benefits if:
(a) during the transitional period of the fund,
there arose in relation to the benefits a circumstance that would have resulted
in the satisfaction of a condition of release and a ‘Nil’ cashing restriction
if these regulations applied; or
(b) both:
(i) the benefits were rolled over or
transferred to the fund from:
(A) a superannuation fund (Fund
A) during its transitional period; or
(B) a regulated
superannuation fund or an approved deposit fund to which the benefits were
rolled over or transferred from a superannuation fund (Fund B)
during its transitional period; and
(ii) the trustee is reasonably
satisfied that:
(A) during the transitional
period of Fund A or Fund B, there arose in relation to the benefits a
circumstance that would have resulted in the satisfaction of a condition of
release and a ‘Nil’ cashing restriction if these regulations applied; or
(B) before the benefits were
rolled over or transferred to Fund A or Fund B from a regulated superannuation
fund or an approved deposit fund, the relevant cashing restriction set out in
Schedule 1 in respect of the benefits was ‘Nil’.
(2) An investment earning in relation to a benefit of
any kind is an unrestricted non‑preserved benefit on a day if:
(a) the benefit was cashed, before that day, in
the form of a non‑commutable life pension; and
(b) for a benefit that was commenced under the
condition of release mentioned in item 110 or 208 of Schedule 1, the
pensioner has satisfied a condition of release in respect of which the cashing
restriction for preserved benefits and restricted non‑preserved benefits
is ‘Nil’; and
(c) the pension commenced to be paid before that
day.
(3) An investment earning in relation to a benefit of
any kind is an unrestricted non‑preserved benefit on a day if:
(a) the benefit was cashed, before that day, in
the form of a non‑commutable life annuity; and
(b) for a benefit that was commenced under the
condition of release mentioned in item 110 or 208 of Schedule 1, the
annuitant has satisfied a condition of release in respect of which the cashing
restriction for preserved benefits and restricted non‑preserved benefits
is ‘Nil’; and
(c) the annuity commenced to be paid before that
day.
(4) An investment earning in relation to a benefit is an
unrestricted non‑preserved benefit on a day if:
(a) the benefit is an unrestricted non‑preserved
benefit; and
(b) the benefit was cashed, before that day, in
the form of a pension; and
(c) for a benefit that was commenced under the
condition of release mentioned in item 110 or 208 of Schedule 1, the
pensioner has satisfied a condition of release in respect of which the cashing
restriction for preserved benefits and restricted non‑preserved benefits
is ‘Nil’; and
(d) the pension commenced to be paid before that
day.
(5) An investment earning in relation to a benefit is an
unrestricted non‑preserved benefit on a day if:
(a) the benefit is an unrestricted non‑preserved
benefit; and
(b) the benefit was cashed, before that day, in
the form of an annuity; and
(c) for a benefit that was commenced under the
condition of release mentioned in item 110 or 208 of Schedule 1, the
annuitant has satisfied a condition of release in respect of which the cashing
restriction for preserved benefits and restricted non‑preserved benefits
is ‘Nil’; and
(d) the annuity commenced to be paid before that
day.
6.16 Redistribution
of member benefits within a fund in certain circumstances by operation of
governing rules or action of trustee
(1) For the purpose of subregulation (2), the following
are categories of benefits:
(a) preserved benefits, as defined in
Subdivision 6.1.2;
(b) restricted non‑preserved benefits, as
defined in Subdivision 6.1.3;
(c) unrestricted non‑preserved benefits,
as defined in Subdivision 6.1.4.
(2) For the purposes of this
Part, the governing rules of a fund, or the trustee of a fund, may alter the
category of any of a member’s benefits in the fund but, subject to
subregulation (3), not so as to:
(a) decrease the amount of the member’s
preserved benefits in the fund; or
(b) increase the amount of the member’s
unrestricted non‑preserved benefits in the fund.
(3) The trustee may alter the category of benefits in a
fund from preserved benefits to unrestricted non‑preserved benefits if:
(a) before the commencement of regulation 6.15A
and during the transitional period of the fund, there arose in relation to the
benefits a circumstance that would have resulted in the satisfaction of a
condition of release and a ‘Nil’ cashing restriction if these regulations
applied; or
(b) before the commencement of regulation 6.15A,
both:
(i) the benefits were rolled over or
transferred to the fund from:
(A) a superannuation fund (Fund
A) during its transitional period; or
(B) a regulated
superannuation fund or an approved deposit fund to which the benefits were
rolled over or transferred from a superannuation fund (Fund B)
during its transitional period; and
(ii) the trustee is reasonably
satisfied that:
(A) during the transitional
period of Fund A or Fund B, there arose in relation to the benefits a
circumstance that would have resulted in the satisfaction of a condition of
release and a ‘Nil’ cashing restriction if these regulations applied; or
(B) before the benefits were
rolled over or transferred to Fund A or Fund B from a regulated superannuation
fund or an approved deposit fund, the relevant cashing restriction set out in
Schedule 1 in respect of the benefits was ‘Nil’.
6.16A When
non‑preserved benefits may be reduced
(1) This regulation applies if, on or after 1 July 1999,
the amount of a negative investment return for a period after
30 June 1999 to be debited against a member’s benefits is more than
the amount of the member’s preserved benefits.
(2) The negative investment return must be debited in
the following order:
(a) first, against the member’s preserved
benefits; and
(b) second, against the member’s restricted non‑preserved
benefits; and
(c) third (if required), against the member’s
unrestricted non‑preserved benefits.
Division 6.2 Payment of benefits
6.17 Restriction
on payment
(1) For the purposes of subsections 31 (1) and 32 (1) of
the Act, the standards set out in subregulations (2),
(2A) and (2B) are applicable to the operation of regulated
superannuation funds and approved deposit funds.
(2) A member’s benefits in a
fund:
(a) may be paid:
(i) by being
cashed in accordance with Division 6.3; or
(ii) by being
rolled over or transferred in accordance with Division 6.4, 6.5 or 6.7; or
(iii) by being allotted under Division
6.7; and
(b) must not be paid in
that way except when, and to the extent that, the fund is required or permitted
under this Part to pay them; and
(c) must be paid in that way when, and to the
extent that, the fund is required under this Part to pay them.
(2A) A member’s benefits in a
fund:
(a) may be paid:
(i) by being
cashed in accordance with Part 7A; or
(ii) by being rolled over or
transferred in accordance with Part 7A; and
(b) must not be paid in
that way except when, and to the extent that, the fund is required or permitted
under Part 7A to pay them; and
(c) must be paid in that way when, and to the
extent that, the fund is required under Part 7A to pay them.
(2B) A
member’s benefits in a fund:
(a) may be paid in a way that is not described in
subregulations (2) and (2A):
(i) as a consequence of the trustee
taking action that, because of Division 2.2 of the Family Law
(Superannuation) Regulations 2001, has the effect that a future payment in
respect of the superannuation interest of the member spouse would not be a
splittable payment; or
(ii) as a consequence of the operation
of a fund’s governing rules that, because of Division 2.2 of the Family Law
(Superannuation) Regulations 2001, has the effect that a future payment in
respect of the superannuation interest of the member spouse would not be a
splittable payment; and
(b) must not be paid in
that way except when, and to the extent that, the fund would be required or
permitted under those Regulations to pay them; and
(c) must be paid in that way when, and to the
extent that, the fund would be required under those regulations to pay them.
(3) For this regulation, a payment to
which regulation 7.9.66 or 7.9.68 of the Corporations Regulations 2001 relates
is taken to be the payment of a benefit.
6.17A Payment of benefit on or after death of
member
(Act, s 59 (1A))
(1) For subsections 31 (1) and 32 (1) of the
Act, the standard set out in subregulation (4) is applicable to the operation
of regulated superannuation funds and approved deposit funds.
(2) For subsection 59 (1A) of the Act, the
governing rules of a fund may permit a member of the fund to require the
trustee to provide any benefits in respect of the member, on or after the death
of the member, to the legal personal representative or a dependant of the
member if the trustee gives to the member information under subregulation (3).
(3) The trustee must give to the member information that
the trustee reasonably believes the member reasonably needs for the purpose of
understanding the right of that member to require the trustee to provide the
benefits.
(4) Subject to subregulation
(4A), and regulations 6.17B, 7A.17 and 7A.18, if the governing rules of
a fund permit a member of the fund to require the trustee to provide any
benefits in accordance with subregulation (2), the trustee must pay a benefit
in respect of the member, on or after the death of the member, to the person or
persons mentioned in a notice given to the trustee by the member if:
(a) the person, or each of the persons,
mentioned in the notice is the legal personal representative or a dependant of
the member; and
(b) the proportion of the benefit that will be
paid to that person, or to each of those persons, is certain or readily
ascertainable from the notice; and
(c) the notice is in accordance with subregulation
(6); and
(d) the notice is in effect.
(4A) The trustee is not required
to comply with subregulation (4) if the trustee:
(a) is subject to a
court order that has the effect of restraining or prohibiting the trustee from
paying a benefit in respect of the member in accordance with a notice of the
kind described in that subregulation; or
(b) is aware that the member of the fund is
subject to a court order that:
(i) requires
the member to amend or revoke a notice of that kind that the member has given
the trustee; or
(ii) has the effect of restraining or
prohibiting the member from giving a notice of that kind.
(5) A member who gives notice under subregulation (4)
may:
(a) confirm the notice by giving to the trustee
a written notice, signed, and dated, by the member, to that effect; or
(b) amend, or revoke, the notice by giving to the
trustee notice, in accordance with subregulation (6), of the amendment or
revocation.
(6) For paragraphs (4) (c) and (5) (b), the notice:
(a) must be in writing; and
(b) must be signed, and dated, by the member in
the presence of 2 witnesses, being persons:
(i) each of whom has turned 18; and
(ii) neither of whom is a person
mentioned in the notice; and
(c) must contain a declaration signed, and
dated, by the witnesses stating that the notice was signed by the member in
their presence.
(7) Unless sooner revoked by the member, a notice under
subregulation (4) ceases to have effect:
(a) at the end of the period of 3 years after
the day it was first signed, or last confirmed or amended, by the member; or
(b) if the governing rules of the fund fix a
shorter period — at the end of that period.
6.17AA Payments
prevented under Family Law Act 1975
If a trustee of a regulated superannuation fund or
an approved deposit fund does not make a payment in accordance with the
standard set out in subregulation 6.17 (2) because the trustee is
prevented from doing so:
(a) under subsection 90ML (4) of the Family
Law Act 1975; or
(b) by an order made under subsection 90MU (1)
of the Family Law Act 1975;
the trustee is not in breach of the standard.
Note Subsection 90ML (4) of the Family
Law Act 1975 provides that while a payment flag is operating on a
superannuation interest, the trustee must not make any splittable payment to
any person in respect of the interest. Subsection 90MU (1) of the Family
Law Act 1975 provides that a court may make an order in relation to a
superannuation interest directing the trustee not to make a splittable payment
in respect of the interest without the leave of the court.
6.17B Duty
to seek information
If an item of information given by a member in a
notice under subregulation 6.17A (4) is not sufficiently clear to allow the
trustee to pay the benefit, the trustee must seek from the member a written
statement to clarify the item as soon as practicable after the trustee receives
the notice.
Example
If the proportion of the benefit that
will be paid to the person, or to each person, mentioned in the notice is not
certain, or is not readily ascertainable from the notice given by the member,
the trustee must seek a statement of that proportion from the member.
6.17C Payment and commutation of pension in breach of standards
If a regulated superannuation fund provides a
pension under rules which meet the standards of subregulation 1.06 (2),
(7) or (8), the trustee must not:
(a) pay the pension in
a way that does not meet the standards of the relevant subregulation; or
(b) allow the pension
to be commuted except in accordance with the relevant subregulation.
Division 6.3 Cashing
of benefits
Subdivision
6.3.1 Regulated superannuation funds
6.18 Voluntary cashing of preserved benefits in
regulated superannuation funds
(1) A member’s preserved benefits in a regulated
superannuation fund may be cashed on or after the satisfaction by the member of
a condition of release.
(2) The amount of preserved benefits that may be cashed
in accordance with subregulation (1) must not exceed the sum of:
(a) the amount of preserved benefits of the
member that had accrued at the time when the member satisfied the condition of
release; and
(b) before 1 July 1999 — the amount of any
investment earnings accruing on those benefits from the time when the member
satisfied the condition of release.
(3) Subject to subregulation
(4), the form in which preserved benefits may be cashed under this regulation
is, unless the satisfied condition of release is the death of the member:
(a) a form (if any)
specified in Schedule 1 as a cashing restriction relating to the condition of
release; or
(b) if the
specified cashing restriction is ‘Nil’ — any 1 or more of the following
forms:
(i) 1 or
more lump sums;
(ii) 1 or
more pensions;
(iii) the
purchase of 1 or more annuities.
Note For the cashing requirement applying on the death of
the member, see regulation 6.21.
(4) A lump sum mentioned in subparagraph
(3) (b) (i) must be payable not later than the time for the payment
of a lump sum mentioned in paragraph 6.21 (2) (a).
6.19 Voluntary
cashing of restricted non‑preserved benefits in regulated superannuation
funds
(1) A member’s restricted non‑preserved benefits
in a regulated superannuation fund may be cashed on or after the satisfaction
by the member of a condition of release.
(2) The amount of restricted non‑preserved benefits
that may be cashed in accordance with subregulation (1) must not exceed the
amount of:
(a) the restricted non‑preserved benefits
of the member that had accrued at the time when the member satisfied the
condition of release; and
(b) before 1 July 1999 — any investment
earnings accruing on those benefits from the time when the member satisfied the
condition of release.
(3) Subject to subregulation (4), the form in which
restricted non‑preserved benefits may be cashed under this regulation is,
unless the satisfied condition of release is the death of the member:
(a) a form (if any)
specified in Schedule 1 as a cashing restriction relating to the condition of
release; or
(b) if the specified cashing restriction is
‘Nil’ — any 1 or more of the following forms:
(i) 1 or
more lump sums;
(ii) 1 or
more pensions;
(iii) the
purchase of 1 or more annuities.
Note For the cashing requirement applying on the death of
the member, see regulation 6.21.
(4) A lump sum mentioned in subparagraph (3) (b) (i)
must be payable not later than the time for the payment of a lump sum mentioned
in paragraph 6.21 (2) (a).
6.19A Release of benefits on compassionate
grounds
(1) A person may apply to
the Regulator for a determination that an amount of the person’s preserved benefits,
or restricted non‑preserved benefits, in a superannuation entity may be
released on the ground that it is required:
(a) to pay for medical treatment or medical
transport for the person or a dependant; or
(b) to enable the person to make a payment on a
loan, to prevent:
(i) foreclosure of a mortgage on the
person’s principal place of residence; or
(ii) exercise by the mortgagee of an
express, or statutory, power of sale over the person’s principal place of
residence; or
(c) to modify the person’s principal place of
residence, or vehicle, to accommodate the special needs of the person, or a
dependant, arising from severe disability; or
(d) to pay for expenses associated with the
person’s palliative care, in the case of impending death; or
(e) to pay for
expenses associated with a dependant’s:
(i) palliative care, in the case of
impending death; or
(ii) death; or
(iii) funeral; or
(iv) burial; or
(f) to meet expenses in other cases where the
release is consistent with a ground mentioned in paragraphs (a) to (e), as
the Regulator determines.
(2) The Regulator must determine, in writing, that the
person has satisfied, for the purposes of subregulation 6.18 (1) or
6.19 (1), a condition of release on a compassionate ground if the
Regulator is satisfied that:
(a) the release is required on a ground
mentioned in subregulation (1); and
(b) the person does not have the financial
capacity to meet an expense arising from that ground.
(3) The Regulator cannot be satisfied that money is
required for medical treatment unless 2 registered medical practitioners (at
least one of whom must be a specialist) certify that:
(a) the medical treatment is necessary to:
(i) treat a life threatening illness
or injury; or
(ii) alleviate acute, or chronic, pain;
or
(iii) alleviate an acute, or chronic,
mental disturbance; and
(b) the treatment is not readily available to the
person, or the dependant, through the public health system.
(4) The Regulator cannot be satisfied that money is
required for medical transport unless the medical treatment for which
the medical transport is required has been certified, under subregulation (3),
as necessary for a reason mentioned in paragraph (3) (a).
(5) The Regulator cannot be satisfied that money is
required on the ground mentioned in paragraph (1) (b) unless the
person gives to the Regulator a written statement from the mortgagee that:
(a) payment of an amount is overdue; and
(b) if the person fails to pay the amount, the
mortgagee will:
(i) foreclose the mortgage on the
person’s principal place of residence; or
(ii) exercise its express, or
statutory, power of sale over the person’s principal place of residence.
(6) A statement under subregulation (5) must include the
following information:
(a) the amount that is equal to 3 months’
repayments under the mortgage; and
(b) the amount that is 12 months’ interest on the
outstanding balance of the loan at the time the statement is made.
(7) In this regulation:
medical transport means transport, for
medical attention, by land, water or air.
6.20 Voluntary
cashing of unrestricted non‑preserved benefits in regulated
superannuation funds
(1) A member’s unrestricted non‑preserved benefits
in a regulated superannuation fund may be cashed at any time.
(2) The amount of unrestricted non‑preserved
benefits that may be cashed in accordance with subregulation (1) is the whole
or part of the member’s unrestricted non‑preserved benefits in the fund.
(3) Subject to subregulation (4), the form in which
unrestricted non‑preserved benefits may be cashed under this regulation
is, unless the cashing occurs in consequence of the death of the member, any
one or more of the following forms:
(a) one or more lump
sums;
(b) one or more
pensions;
(c) the purchase of
one or more annuities.
Note For the cashing requirement applying on the death of
the member, see regulation 6.21.
(4) A lump sum mentioned in paragraph (3) (a) must be
payable not later than the time for the payment of a lump sum mentioned in
paragraph 6.21 (2) (a).
6.20A Compulsory
cashing of benefits in a regulated superannuation fund that is not an unfunded
public sector superannuation scheme — temporary residents
(1) This regulation
applies to a member’s benefits in a regulated superannuation fund that is not
an unfunded public sector superannuation scheme if:
(a) the member:
(i) was a temporary resident; and
(ii) is not an Australian citizen, New
Zealand citizen or permanent resident; and
(iii) has departed from Australia; and
(b) the member’s visa has ceased to be in effect.
(1A) The member’s benefits must be cashed if:
(a) the trustee of the fund receives a request
from the member that the benefits be cashed; and
(b) subregulation (2) or (3) is complied with.
(2) If the member’s
withdrawal benefit in the fund is less than $5 000, the trustee of the
fund must receive:
(a) a copy, or other evidence, of a visa showing
that the member was a temporary resident but the member’s temporary visa has
ceased to be in effect; and
(b) a copy of the member’s passport showing that
the member has departed from Australia.
Note For the ways of giving evidence of a
visa, see regulation 2.17 of the Migration Regulations 1994.
(3) The trustee of the fund must be satisfied, based on
a written statement from the Department of Immigration and Citizenship, that:
(a) the member was a temporary resident but the
member’s temporary visa has ceased to be in effect; and
(b) the member has departed from Australia.
(3A) For subregulation (3), the statement may be in
electronic form.
(4) The benefits must be cashed in the period mentioned
in subregulation (5):
(a) as a single lump sum that is at least the
amount of the member’s withdrawal benefit in the fund; or
(b) if the fund
receives any combination of contributions, transfers and rollovers after
cashing the benefits:
(i) in a way that ensures that an
amount that is at least the amount of the member’s withdrawal benefit in the
fund is cashed; and
(ii) without requiring an additional
application from the member.
(5) For subregulation
(4), the period is:
(a) if the trustee of the fund receives a
request from the member not later than 31 October 2002 — 3 months after
the request is lodged; and
(b) in any other case — 28 days after the
request is lodged.
Note A payment made under this regulation
is a departing Australia superannuation payment within the
meaning of section 301‑170 of the 1997 Tax Act.
6.20B Voluntary
cashing of benefits in a regulated superannuation fund that is an unfunded
public sector superannuation scheme — temporary residents
(1) This regulation applies to a member’s benefits in a
regulated superannuation fund that is an unfunded public sector superannuation
scheme if:
(a) the member:
(i) was a temporary resident; and
(ii) is not an Australian citizen, New
Zealand citizen or permanent resident; and
(iii) has departed from Australia; and
(b) the member’s visa has ceased to be in effect.
(1A) The member’s benefits may be cashed if:
(a) the trustee of the fund receives a request
from the member that the benefits be cashed; and
(b) subregulation (2) or (3) is complied with.
(2) If the member’s withdrawal benefit in the fund is
less than $5 000, the trustee of the fund must receive:
(a) a copy, or other evidence, of a visa showing
that the member was a temporary resident but the member’s temporary visa has
ceased to be in effect; and
(b) a copy of the member’s passport showing that
the member has departed from Australia.
Note For the ways of giving evidence of a
visa, see regulation 2.17 of the Migration Regulations 1994.
(3) The trustee of the fund must be satisfied, based on
a written statement from the Department of Immigration and Citizenship, that:
(a) the member was a temporary resident but the
member’s temporary visa has ceased to be in effect; and
(b) the member has departed from Australia.
(3A) For subregulation (3), the statement may be in
electronic form.
(4) If the benefits are cashed, the benefits must be
cashed:
(a) as a single lump sum that is at least the
amount of the member’s withdrawal benefit in the fund; or
(b) if the fund receives any combination of
contributions, transfers and rollovers after cashing the benefits:
(i) in a way that ensures that an
amount that is at least the amount of the member’s withdrawal benefit in the fund
is cashed; and
(ii) without requiring an additional
application from the member.
Note A payment made under this regulation is a
‘departing Australia superannuation payment’ within the meaning of subsection
995‑1 (1) of the 1997 Tax Act.
6.20C Cashing of benefits in a regulated superannuation fund —
payment to Commissioner for Taxation
If the trustee of a regulated superannuation fund
is required to pay an amount to the Commissioner of Taxation under the Superannuation
(Unclaimed Money and Lost Members) Act 1999 for a member’s superannuation
interest in the fund, the amount must be cashed in favour of the Commissioner
of Taxation as a single lump sum.
Note An amount to be paid under the Superannuation
(Unclaimed Money and Lost Members) Act 1999 must be paid by the time
required under that Act.
6.21 Compulsory
cashing of benefits in regulated superannuation funds
(1) Subject to subregulation
(3), a member’s benefits in a regulated superannuation fund must be cashed as
soon as practicable after the member dies.
(2) The form in which benefits may be cashed under this
regulation is any one or more of the following forms:
(a) in respect of each person to whom benefits
are cashed:
(i) a single lump sum; or
(ii) an interim lump sum (not exceeding
the amount of the benefits ascertained at the date of the event mentioned in
subregulation (1)) and a final lump sum (not exceeding the balance of the
benefits as finally ascertained in relation to the event);
(b) subject to subregulations (2A) and (2B):
(i) 1 or
more pensions;
(ii) the
purchase of 1 or more annuities.
(2A) If a member dies on or after
1 July 2007, subparagraphs (2) (b) (i) and (ii) apply to an entitled
recipient only if, at the time of the member’s death, the entitled recipient:
(a) is a dependant of
the member; and
(b) in the case of a child of the member:
(i) is less
than 18 years of age; or
(ii) being 18 or more years of age:
(A) is
financially dependent on the member and less than 25 years of age; or
(B) has
a disability of the kind described in subsection 8 (1) of the Disability
Services Act 1986.
(2B) If benefits in relation to a deceased member are
being paid to a child of the deceased member in the form of a pension or an
annuity in accordance with subregulation (2A), the benefits must be cashed as a
lump sum on the earlier of:
(a) the day on which
the annuity or pension is commuted, or the term of the annuity or pension
expires (unless the benefit is rolled over to commence a new annuity or
pension); and
(b) the day on which
the child attains age 25;
unless the child has a disability of the
kind described in subsection 8 (1) of the Disability Services Act 1986
on the day that would otherwise be applicable under paragraph (2B) (a) or (b).
(3) For the purposes of subregulation
(1), it is sufficient if, instead of being cashed, the benefits are
rolled over as soon as practicable for immediate cashing.
6.22 Limitation
on cashing of benefits in regulated superannuation funds in favour of persons
other than members or their legal personal representatives
(1) Subject to regulations 6.22B, 7A.13, 7A.17 and
7A.18, a member’s benefits in a regulated superannuation fund must not be
cashed in favour of a person other than the member or the member’s legal
personal representative:
(a) unless:
(i) the
member has died; and
(ii) the
conditions of subregulation (2) or (3) are satisfied; or
(b) unless the conditions of subregulation (4) or
(5) are satisfied.
(2) The conditions of
this subregulation are satisfied if the benefits are cashed in favour of either
or both of the following:
(a) the member’s legal personal representative;
(b) one or more of the member’s dependants.
(3) The conditions of
this subregulation are satisfied if:
(a) the trustee has not, after making reasonable
enquiries, found either a legal personal representative, or a dependant, of the
member; and
(b) the person in whose favour benefits are
cashed is an individual.
(4) The conditions of this subregulation are satisfied
if:
(a) the trustee has
received a release authority under section 292‑410 of the Income Tax
Assessment Act 1997 in respect of the member; and
(b) the benefits are
cashed in favour of the Commissioner of Taxation in accordance with the
authority.
(5) The conditions of this subregulation are satisfied
if the member’s benefits are paid to the
Commissioner of Taxation under the Superannuation (Unclaimed Money and Lost
Members) Act 1999.
6.22A Priority
in cashing benefits in certain cases — regulated superannuation funds
(1) This regulation applies to a trustee of a regulated
superannuation fund if:
(a) a member of the fund has satisfied a
condition of release; and
(b) there is a cashing restriction (other than a
‘nil’ restriction) in respect of that condition.
(2) In cashing benefits in accordance with the
restriction, the trustee must give priority to benefits in the following order:
(a) first — to unrestricted non‑preserved
benefits;
(b) second — to restricted non‑preserved
benefits;
(c) third — to preserved benefits.
6.22B When benefits in regulated
superannuation funds may be cashed in favour of persons except members
A member’s benefits in a regulated
superannuation fund may be cashed in favour of a person other than the member
if:
(a) the cashing is expressly permitted by the
Regulator in a written approval for the purposes of subparagraph 62 (1) (b) (v)
of the Act; and
(b) the benefits are cashed only to the extent of
that approval.
Subdivision 6.3.2 Approved deposit
funds
6.23 Voluntary
cashing of preserved benefits in approved deposit funds
(1) Subject to regulation 6.27, a member’s preserved
benefits in an approved deposit fund may be cashed on or after the satisfaction
by the member of a condition of release.
(2) The amount of preserved benefits that may be cashed
in accordance with subregulation (1) must not exceed the amount of:
(a) the preserved benefits of the member that
had accrued at the time when the member satisfied the condition of release; and
(b) before 1 July 1999 — any investment
earnings accruing on those benefits from the time when the member satisfied the
condition of release.
(3) Subject to
subregulation (4), the form in which preserved benefits may be cashed under
this regulation is:
(a) the form (if any) specified in the cashing
restriction for preserved benefits set out in Schedule 1 in relation to the
relevant condition of release; or
(b) if that cashing restriction is ‘Nil’ — a
lump sum or 2 or more lump sums.
(4) A lump sum mentioned in paragraph (3) (b) must be
payable not later than the time for the payment of a lump sum mentioned in
subregulation 6.25 (2).
6.24 Voluntary
cashing of unrestricted non‑preserved benefits in approved deposit funds
(1) Subject to regulation 6.27, a member’s unrestricted
non‑ preserved benefits in an approved deposit fund may be cashed at any
time.
(2) The amount of unrestricted non‑preserved
benefits that may be cashed in accordance with subregulation (1) is the whole
or part of the member’s unrestricted non‑preserved benefits in the fund.
(3) Subject to subregulation (4), the form in which
unrestricted non‑preserved benefits may be cashed under this regulation
is a lump sum or 2 or more lump sums.
(4) A lump sum mentioned in subregulation (3) must be
payable not later than the time for the payment of a lump sum mentioned in
subregulation 6.25 (2).
6.24A Compulsory cashing of benefits in approved
deposit funds — temporary residents
(1) This regulation
applies to a member’s benefits in an approved deposit fund if:
(a) the member:
(i) was a temporary resident; and
(ii) is not an Australian citizen, New
Zealand citizen or permanent resident; and
(iii) has departed from Australia; and
(b) the member’s visa has ceased to be in effect.
(1A) The member’s benefits must be cashed if:
(a) the trustee of the fund receives a request
from the member that the benefits be cashed; and
(b) subregulation (2) or (3) is complied with.
(2) If the member’s
withdrawal benefit in the fund is less than $5 000, the trustee of the
fund must receive:
(a) a copy, or other evidence, of a visa showing
that the member was a temporary resident but the member’s temporary visa has
ceased to be in effect; and
(b) a copy of the member’s passport showing that
the member has departed from Australia.
Note For the ways of giving evidence of a
visa, see regulation 2.17 of the Migration Regulations 1994.
(3) The trustee of the fund must be satisfied, based on
a written statement from the Department of Immigration and Citizenship, that:
(a) the member was a temporary resident but the
member’s temporary visa has ceased to be in effect; and
(b) the member has departed from Australia.
(3A) For subregulation (3), the statement may be in
electronic form.
(4) The benefits must be cashed in the period mentioned
in subregulation (5):
(a) as a single lump sum that is at least the
amount of the member’s withdrawal benefit in the fund; or
(b) if the fund
receives any combination of transfers and rollovers after cashing the benefits:
(i) in a way that ensures that an
amount that is at least the amount of the member’s withdrawal benefit in the
fund is cashed; and
(ii) without requiring an additional
application from the member.
(5) For subregulation (4), the period is:
(a) if the trustee of the fund receives a
request from the member not later than 31 October 2002 — 3 months after
the request is lodged; and
(b) in any other case — 28 days after the
request is lodged.
Note A payment made under this regulation
is a departing Australia superannuation payment within the
meaning of section 301‑170 of the 1997 Tax Act.
6.24B Cashing of benefits in approved deposit funds —
payment to Commissioner for Taxation
If the trustee of an approved deposit fund is
required to pay an amount to the Commissioner of Taxation under the Superannuation
(Unclaimed Money and Lost Members) Act 1999 for a member’s superannuation
interest in the fund, the amount must be cashed in favour of the Commissioner
of Taxation as a single lump sum.
Note An amount to be paid under the Superannuation
(Unclaimed Money and Lost Members) Act 1999 must be paid by the time
required under that Act.
6.25 Compulsory
cashing of benefits in approved deposit funds
(1) Subject to subregulation
(3), a member’s benefits in an approved deposit fund must be cashed as soon as
practicable after the member dies.
(2) The form in which benefits may be cashed
under this regulation is, in respect of each person to whom benefits are
cashed:
(a) a single lump sum; or
(b) an interim lump sum (not exceeding the amount
of the benefits ascertained at the date of an event mentioned in subregulation
(1)) and a final lump sum (not exceeding the balance of the benefits as finally
ascertained in relation to the event).
(3) Subregulation (1) is
satisfied if, instead of being cashed, the benefits are rolled over as soon as
practicable for immediate cashing.
6.26 Limitation
on cashing of benefits in approved de posit funds in favour of persons other
than members or their legal personal representatives
(1) Subject to this
regulation and regulations 7A.13, 7A.17 and 7A.18,
a member’s benefits in an approved deposit fund must not be cashed in favour of
a person other than the member or the member’s legal personal representative
unless:
(a) the member has died; and
(b) either:
(i) the benefits are cashed in favour
of the member’s legal personal representative; or
(ii) the trustee has not, after making
reasonable enquiries, found a legal personal representative of the member; and
(c) either:
(i) the person in whose favour
benefits are cashed is a dependant of the member; or
(ii) if, after making reasonable
enquiries, the trustee has not found a dependant of the member, the person in
whose favour benefits are cashed is an individual.
(2) A member’s benefits in an approved deposit fund may
be cashed if:
(a) the trustee has
received a release authority under section 292‑410 of the Income Tax
Assessment Act 1997 in respect of the member; and
(b) the benefits are cashed in favour of the
Commissioner of Taxation in accordance with the authority.
(3) A member’s benefits in an approved deposit fund may
be cashed if the benefits are paid to the Commissioner of Taxation under the Superannuation
(Unclaimed Money and Lost Members) Act 1999.
6.27 Limitation on cashing benefits in approved deposit funds of less than $500
The trustee of an approved deposit fund must not
cash an amount of a member’s benefits in the fund that is less than $500 unless
the purpose of cashing the amount is:
(a) to close the
member’s account; or
(b) to cash the amount to give effect to a
release authority under:
(i) section
292‑415 of the Income Tax Assessment Act 1997; or
(ii) section
292‑80C of the Income Tax (Transitional Provisions) Act 1997;
in respect of the
member; or
(c) to pay an amount under the Superannuation
(Unclaimed Money and Lost Members) Act 1999.
6.27A Priority
in cashing benefits in certain cases — approved deposit funds
(1) This regulation applies to a trustee of an approved
deposit fund if:
(a) a member of the fund has satisfied a
condition of release; and
(b) there is a cashing restriction (other than a
‘nil’ restriction) in respect of that condition.
(2) In cashing benefits in accordance with the
restriction, the trustee must give priority to benefits in the following order:
(a) first — to unrestricted non‑preserved
benefits;
(b) second — to preserved benefits.
Division 6.4 General rules for rollover and transfer of benefits in
regulated superannuation funds and approved deposit funds
Note See
also Parts 22 and 24 of the Act.
6.27B Definition
In this Division:
consent means:
(a) written consent; or
(b) any other form of consent determined by the
Regulator as sufficient in the circumstances.
6.28 Rollover —
regulated superannuation funds and approved deposit funds [see Note 2]
(1) Except as otherwise provided by the Act, the Corporations Act 2001, the Corporations Regulations
2001 or these regulations, a member’s benefits in a regulated
superannuation fund or an approved deposit fund must not be rolled over from
the fund unless:
(a) the member has given to the trustee the
member’s consent to the rollover; or
(b) the trustee of the fund believes, on
reasonable grounds, that:
(i) the trustee of the regulated
superannuation fund, the approved deposit fund or the EPSSS; or
(ii) the RSA institution providing the
RSA;
into which the benefits are to be rolled
over has received, from the member, consent to the rollover.
(2) The fund to which the money is to be rolled over
must not be a registrable superannuation entity that:
(a) is a regulated superannuation fund or an
approved deposit fund; and
(b) has not been registered under Part 2B of the
Act.
6.29 Transfer —
funds [see Note 2]
(1) Except as otherwise provided by the Act, the Corporations Act 2001, the Corporations Regulations
2001 or these regulations, a member’s benefits in a fund must not be
transferred from the fund unless:
(a) the member has given to the trustee the
member’s consent to the transfer; or
(b) the trustee of the fund believes, on
reasonable grounds, that:
(i) the trustee of the fund or the
EPSSS; or
(ii) the RSA institution providing the
RSA;
into which the benefits are to be
transferred, has received, from the member, consent to the transfer; or
(c) the transfer is to a successor fund.
(2) The fund to which the money is to be transferred
must not be a registrable superannuation entity that:
(a) is a regulated superannuation fund or an
approved deposit fund; and
(b) has not been registered under Part 2B of the
Act.
Division 6.5 Compulsory rollover and transfer of superannuation benefits
in regulated superannuation funds and approved deposit funds
6.30 Application
(1) This Division
applies:
(a) to a regulated superannuation fund, other
than a fund mentioned in paragraph (2) (a) or (b); and
(b) to an approved deposit fund.
(2) This Division does not apply:
(a) to an unfunded public sector superannuation
scheme; and
(b) to a self‑managed superannuation fund;
and
(c) in respect of a defined benefit component of
a superannuation interest in a defined benefit fund, if the member who holds
the interest is an employee of an employer‑sponsor of the fund; and
(d) to benefits that are being paid as a pension
(other than an allocated pension).
6.31 Definitions for Division 6.5
Defined benefit component
(1) Subject to
subregulation (2), a defined benefit component of a
superannuation interest is a component of the interest in which the benefits
are defined by reference to 1 or more of the following:
(a) the amount
of:
(i) the member’s salary at the date of
the termination of the member’s employment, the date of the member’s
retirement, or another date; or
(ii) the member’s salary averaged over
a period; or
(iii) salary, or allowance in the
nature of salary,
payable to another person (for example, a judicial officer, a member of the
Commonwealth or a State Parliament, a member of the Legislative Assembly of a
Territory);
(b) a specified amount;
(c) specified conversion factors.
(2) A component of a superannuation interest is not a
defined benefit component if the only benefits defined by reference to any of
the amounts or factors mentioned in subregulation (1) are benefits payable
on death or disability.
Illiquid
investment
(3) An investment is an illiquid
investment in relation to a member’s interest in a superannuation fund
if it is of a nature that produces either of the following outcomes:
(a) it cannot be
converted to cash in less than the time required to rollover or transfer a
withdrawal benefit under subregulation 6.34 (5);
(b) converting it to cash within the time period
specified in subregulation 6.34 (5) would be likely to have a significant
adverse impact on the realisable value of the investment.
6.32 Operating
standards
(1) For subsection 31 (1) of the Act, a requirement
set out in this Division is a standard applicable to the operation of regulated
superannuation funds.
(2) For subsection 32 (1) of the Act, a requirement
set out in this Division is a standard applicable to the operation of approved
deposit funds.
6.33 Request
for rollover or transfer of withdrawal benefit
(1) A member of a regulated superannuation fund or an
approved deposit fund may, in writing, ask the trustee of the fund to roll over
or transfer an amount that is the whole or part of the member’s withdrawal
benefit.
(2) If the trustee of
the fund requires further information that is mandatory information in the form
in Schedule 2A (whether or not the request is made using the form):
(a) the trustee must,
within 10 working days after receiving the request, ask the member for the
information; and
(b) if the trustee has
not received the information within 10 working days after making the
request, the trustee must make reasonable further inquiries of the member to
obtain the information.
Note If a request does not include all of
the mandatory information in the form in Schedule 2A (whether or not the
request is made using the form) the trustee may still roll over or transfer the
amount without asking for the rest of the mandatory information.
(3) If the trustee of
the fund requires further information in relation to a request for a partial
transfer:
(a) the trustee must,
within 10 working days after receiving the request, ask the member for the
information; and
(b) if the trustee has
not received the information within 10 working days after making the
request, the trustee must make reasonable further inquiries of the member to
obtain the information.
(4) If the trustee of
the fund requires the information under subregulation 6.34 (3):
(a) the trustee must,
within 10 working days after receiving the request, ask the member for the
information; and
(b) if the trustee has
not received the information within 10 working days after making the
request, the trustee must make reasonable further inquiries of the member to
obtain the information.
6.34 Rollover or transfer of withdrawal benefit
General
(1) Subject to regulations
6.35 and 6.38, if a trustee of a regulated superannuation fund or an approved
deposit fund receives a request under regulation 6.33, the trustee must roll
over or transfer the amount in accordance with the request.
(2) Subject to subregulation (3):
(a) a request to roll over or transfer an
amount that is the whole of the member’s withdrawal benefit may be made:
(i) using the form specified in
Schedule 2A; or
(ii) in another manner; and
(b) a request to roll over or transfer an amount
that is part of the member’s withdrawal benefit may include:
(i) the
information that would be required by the form specified in Schedule 2A; and
(ii) any
other information that the trustee of the transferring superannuation fund
advises the member to be necessary to process the request.
Note The form in Schedule 2A deals with
information about tax file numbers that is required in accordance with Part 25A
of the Act, and approvals under that Part.
It is recommended that applicants use
the form of request in Schedule 2A to allow trustees to roll over or transfer
whole balance amounts as quickly and efficiently as possible. Making the
request in another way may require a trustee to seek further information from the
member under subregulation 6.33 (2).
If subregulation (3) applies, the form
of request may need to be supplemented by the documentation mentioned in the
applicable subregulation.
(3) In addition to the information that is, or would
be, required in accordance with subregulation (2), if:
(a) a request is made
by a member (member 1) to roll
over or transfer an amount that is the whole or part of
the member’s withdrawal benefit to a self managed superannuation fund; and
(b) the trustee of the transferring
superannuation fund is aware that:
(i) another
request has been made to roll over or transfer an amount to the same self
managed superannuation fund; and
(ii) the
other request was made by another member who is not a relative of member 1,
within the meaning of subsection 17A (9) of the Act; and
(iii) the other request:
(A) has
been processed; or
(B) is
currently with the trustee of the transferring superannuation fund to be
processed;
the trustee may also require member 1 to
provide with the request a copy of documentation, complying with the
requirements of certification in the form in schedule 2A, that shows that member 1 is a member or trustee of the
self managed superannuation fund before the trustee processes member 1’s
request.
Examples of documents showing that a
member is a member or trustee of a self managed superannuation fund
1 A trust deed.
2 The member’s
contribution statement.
3 The annual
return of the self managed superannuation fund.
(4) Before the trustee rolls over or transfers an
amount, the trustee must be satisfied that the member:
(a) is aware that the member may ask the
trustee for information that the member reasonably requires for the purpose of
understanding any benefit entitlements that the member may have, including:
(i) information
about any fees or charges that may apply to the proposed rollover or transfer;
and
(ii) information
about the effect of the proposed rollover or transfer on any benefit
entitlements the member may have; and
(b) does not require such
information.
Note Under section 1017C of the Corporations
Act 2001, a trustee of a fund must, on request by a member of the fund,
give the member the information and documents mentioned in subsections 1017C (3)
and (5). See also regulations 7.9.02, 7.9.45, 7.9.46 and 7.9.83 of the Corporations
Regulations 2001.
(5) Subject to
subregulations (6) and (7), the trustee must roll over or transfer the amount
(or the part of the amount requested to be transferred) as soon as practicable,
and in any case within 30 days, after:
(a) the trustee
receives a request made under subregulation 6.33 (1); or
(b) if the trustee requires further
information — the time when the trustee receives all of the information
that would be required in accordance with subregulations 6.33 (2), (3) and
(4); or
(c) if there is a
suspension under regulation 6.36 or 6.37 — the end of the period of the
suspension.
Illiquid investment before 1 July 2007
(6) For an investment that was made
before 1 July 2007, a trustee is not required to rollover or transfer
the whole amount of a member’s interest in the fund (or the part of the amount
requested to be transferred) within the 30 day period mentioned in
subregulation (5) if:
(a) any part of the
member’s interest was an illiquid investment immediately before 1 July 2007;
and
(b) either:
(i) the
trustee informs the member, before 1 July 2008, of the nature of the illiquid
investment, the impact of the investment on the portability of the member’s
interest, and the period within which the investment can be rolled over to
another fund; or
(ii) if the
member makes a request under regulation 6.33 before the trustee has complied
with subparagraph (i) — the trustee informs the member, within 30 days
after receiving the request, of the nature of the illiquid investment, the
impact of the investment on the portability of the member’s interest, and the
period within which the investment can be rolled over to the other fund.
Illiquid investment on or after 1 July
2007
(7) If, on or after 1 July 2007, a
member makes an investment choice under regulation 4.02, and the investment strategy
chosen is an illiquid investment, the trustee is not required to rollover or
transfer the whole of the member’s withdrawal benefit (or a partial amount
requested to be transferred) within the 30 day period mentioned in
subregulation (5) if the trustee:
(a) informs the member of:
(i) the effect of
this subregulation before the member makes the investment choice; and
(ii) the reasons why
the investment is illiquid; and
(iii) the maximum
period in which a transfer must be effected; and
(b) obtains written consent that
the member understands and accepts that a period longer than the 30 days
mentioned in subregulation (5) is required (in respect of the whole or part of
the requested transfer amount) because of the illiquid nature of the investment.
Note The trustee may effect a rollover or
transfer in more than 1 transaction to ensure that only the illiquid
investment is rolled over or transferred outside the 30 day period.
6.35 When
a trustee may refuse to roll over or transfer an amount
(1) A trustee may refuse to roll over or transfer an
amount under regulation 6.34 if:
(a) the fund or RSA to which the member has
requested the amount be rolled over or transferred will not accept the amount;
or
(b) the amount to be rolled over or transferred
is part only of the member’s interest in the fund, and the effect of rolling
over or transferring the amount would be that the member’s interest in the fund
from which the amount is to be rolled over or transferred would be less than
$5 000; or
(c) the trustee has, under regulation 6.34,
rolled over or transferred an amount of the member’s interest within
12 months before the request is received.
(2) If a trustee refuses to roll over or transfer an
amount under subregulation (1), the trustee must tell the member of the refusal
in writing.
6.36 Suspension
or variation of obligation to roll over or transfer amounts by APRA
(1) This regulation
applies if APRA believes, on reasonable grounds, that a rollover or transfer of
an amount by the trustee of a regulated superannuation fund or approved deposit
fund under regulation 6.34 would have a significant adverse effect on:
(a) the financial position of the fund; or
(b) the interests of other members of the fund.
(2) APRA may, by notice in writing to the trustee,
suspend or vary an obligation of the trustee under regulation 6.34.
(3) A suspension or variation under subregulation (2)
applies for the period specified by APRA in the notice.
6.37 Suspension or variation of obligation
to roll over or transfer amounts by APRA — application by trustee
(1) This regulation applies if the trustee of a
regulated superannuation fund or approved deposit fund applies to APRA for a
suspension or variation of the trustee’s obligation to roll over or transfer
amounts under regulation 6.34.
(2) The application must
contain information about the fund’s financial position and the effect of any
rollovers or transfers of amounts under regulation 6.34 on:
(a) the financial position of the fund; or
(b) the interests of other members of the fund.
(3) APRA may ask the trustee to provide further
information in relation to the application within the period specified by APRA.
(4) If the trustee does not provide the further
information within the specified period, APRA may treat the application as if
it had been withdrawn by the trustee.
(5) APRA must consider the application and notify the
trustee of its decision in writing, within 30 days after the later of:
(a) the day APRA receives the application; and
(b) the day APRA receives the further
information.
(6) If APRA believes, on reasonable grounds, that a
rollover or transfer of an amount under regulation 6.34 would have a
significant adverse effect on:
(a) the financial position of the fund; or
(b) the interests of other members of the fund;
APRA may, by notice in writing to the trustee, suspend or vary an
obligation of the trustee under regulation 6.34.
(7) A suspension or variation under subregulation (6)
applies for the period specified by APRA in the notice.
6.38 Trustee’s
obligations if APRA suspends or varies obligation to roll over or transfer
amounts
(1) If, under regulation 6.36 or 6.37, APRA suspends a
trustee’s obligation to roll over or transfer amounts under regulation 6.34,
the trustee must not roll over or transfer an amount under regulation 6.34 for
the period of the suspension.
(2) If, under regulation 6.36 or 6.37, APRA varies a
trustee’s obligation to roll over or transfer amounts under regulation 6.34,
the trustee may roll over or transfer an amount under regulation 6.34 only in
accordance with the variation.
Division 6.6 Additional standards for eligible rollover funds
6.39 Obligations
of trustees
The trustee of an eligible rollover fund must
comply, as soon as practicable, with a request by a member:
(a) to pay a benefit of the member in the fund;
or
(b) to pay a benefit in the form of a lump sum.
Division 6.7 Spouse contributions‑splitting amounts
6.40 Interpretation
In this Division:
allocated surplus contribution amount means
an amount that is allocated from a regulated superannuation fund surplus, by a
trustee, to meet an employer’s liability to make contributions.
applicant means a member who makes an
application under subregulation 6.44 (1).
concessional contributions has the meaning given by subsection 995‑1 (1) of
the 1997 Tax Act.
concessional contributions
cap has the meaning given by
subsection 995‑1 (1) of the 1997 Tax Act.
contributions segment has the meaning given by subsection 995‑1 (1)
of the 1997 Tax Act.
contributions‑splitting
superannuation benefit means a payment
made in accordance subregulation 6.45 (2).
crystallised segment has the meaning given by subsection 995‑1 (1)
of the 1997 Tax Act.
defined benefit component has the meaning
given by regulation 6.31.
directed termination
payment has the meaning given by
section 82‑10F of the Income Tax (Transitional Provisions) Act 1997.
element taxed in the fund has the meaning given by subsection 995‑1 (1) of
the 1997 Tax Act.
element untaxed in the fund has the meaning given
by subsection 995‑1 (1) of the 1997 Tax Act.
foreign superannuation fund has the meaning given
by subsection 995‑1 (1) of the 1997 Tax Act.
maximum splittable amount, in relation to a
financial year, means:
(a) for taxed splittable contributions —
the lesser of:
(i) 85% of
the concessional contributions for that financial year; and
(ii) the
concessional contributions cap for that financial year; and
(b) for untaxed splittable contributions —
100% of the amount of the untaxed splittable contributions made in the
financial year; and
(c) for untaxed
splittable employer contributions — 100% of the concessional contributions
cap for that financial year.
preservation age has the meaning given by regulation
6.01.
relevant financial year, in relation to an
application made under:
(a) paragraph 6.44 (1) (a),
means the last financial year that ended before the date of the application; or
(b) paragraph 6.44 (1) (b),
means the financial year in which the application is made.
splittable
contribution has the meaning given by regulation 6.42.
superannuation benefit has the meaning given by subsection 995‑1 (1)
of the 1997 Tax Act.
superannuation lump sum has the meaning given by subsection 995‑1 (1)
of the 1997 Tax Act.
superannuation interest has the meaning given by subsection 995‑1 (1) of
the 1997 Tax Act.
taxable component has the meaning given by subsection 995‑1 (1)
of the 1997 Tax Act.
taxed splittable contribution has the meaning
given by regulation 6.41.
untaxed splittable contribution has the
meaning given by regulation 6.41.
untaxed splittable employer contribution has
the meaning given by regulation 6.41.
6.41 Meaning
of taxed splittable contribution, untaxed splittable contribution
and untaxed splittable employer contribution
(1) Subject to subregulation (2), a taxed
splittable contribution is:
(a) a contribution that will be included in the
assessable income of an entity as:
(i) a
taxable contribution for section 274 of the Tax Act; or
(ii) a
contribution under Subdivision 295‑C of the 1997 Tax Act; or
(c) an allocated surplus contribution amount.
(2) Each of the following is not a taxed
splittable contribution:
(a) a roll‑over superannuation benefit
within the meaning of Division 306 of the 1997 Tax Act;
(b) an amount allotted under this Division;
(c) a superannuation lump sum that is paid from
a foreign superannuation fund.
(3) Subject to subregulation (4), an untaxed
splittable contribution:
(a) is a contribution made by a fund
member or by another person to a regulated superannuation fund; but
(b) does not include a contribution of that kind
that:
(i) is made after 5 April 2007; and
(ii) will not be included in the
assessable income of an entity as:
(A) a taxable contribution for
section 274 of the Tax Act; or
(B) a contribution under
Subdivision 295‑C of the 1997 Tax Act.
(4) Each of the following is not an untaxed
splittable contribution:
(a) a payment made to a superannuation fund by
an employer, or by another person under an agreement to which the employer is a
party, for the purpose of providing superannuation benefits for, or for
dependants of, an employee of the employer;
(b) a roll‑over superannuation benefit
within the meaning of Division 306 of the 1997 Tax Act;
(c) an amount allotted under this Division;
(d) superannuation lump sum that is paid from a
foreign superannuation fund.
(5) Subject to subregulation (6), an untaxed splittable
employer contribution:
(a) is a contribution
made by the Commonwealth, a State or a Territory to a public sector
superannuation scheme; but
(b) does not include a contribution of that kind
that will be included in the assessable income of an entity as:
(i) a
taxable contribution for section 274 of the Tax Act; or
(ii) a
contribution under Subdivision 295‑C of the 1997 Tax Act.
(6) Each of the following is not an untaxed splittable
employer contribution:
(a) a roll‑over
superannuation benefit within the meaning of Division 306 of the 1997 Tax Act;
(b) an amount allotted
under this Division;
(c) a superannuation
lump sum that is paid from a foreign superannuation fund.
6.42 Meaning
of splittable contribution
(1) Subject to subregulations (2) and (3), a splittable
contribution is:
(a) a contribution to a regulated superannuation fund on or after 1 January 2006; or
(b) an allocated surplus contribution amount that
is allocated on or after 1 January 2006.
(2) Each of the following, received for a member of a
regulated superannuation fund, is not a splittable contribution:
(a) a roll‑over
superannuation benefit within the meaning of Division 306 of the 1997 Tax Act;
(b) an amount allotted
under this Division;
(c) a superannuation
lump sum that is paid from a foreign superannuation fund;
(d) a directed
termination payment or an amount that would form part of the contributions
segment of the superannuation interest.
(3) A contribution by the Commonwealth, a State or a
Territory to a public sector superannuation scheme in relation to a benefit
that accrued in a financial year that commenced before 1 July 2005 is not
a splittable contribution.
6.43 Application
of Division 6.7
(1) This Division applies to:
(a) an accumulation interest; and
(b) a defined benefit interest that is not a
defined benefit component.
(2) This Division does not apply to an interest:
(a) that is subject to a payment split; or
(b) on which a payment flag (within the meaning
of Part VIIIB of the Family Law Act 1975) is operating.
6.44 Application
to roll over, transfer or allot an amount of contributions
(1) A member of a regulated superannuation fund may, in
a financial year, apply to the trustee of the fund to roll over, transfer or
allot an amount of benefits, for the benefit of the member’s spouse, that is
equal to an amount of the splittable contributions made to that fund by, for,
or on behalf of the member in:
(a) the last financial year that ended before
the application; or
(b) the financial year in which the application
is made — where the member’s entire benefit is to be rolled over,
transferred or cashed in that year.
Note This arrangement applies at the
request of the member, and is not an arrangement by which the member’s
superannuation interest is subject to a payment split under Part VIIIB of the Family
Law Act 1975. Part 7A of these Regulations deals with those payment
splitting arrangements.
(2) However,
the application is taken to be invalid:
(a) if in the
financial year in which it is made:
(i) the member has already made an
application in respect of the relevant financial year; and
(ii) the trustee:
(A) is
considering the application; or
(B) has
given effect to that application; or
(b) if the amount of
benefits to which the application relates exceeds the maximum splittable
amount; or
(c) subject to subregulation (3), if, at the
time of application:
(i) the
member’s spouse is aged 65 years or more; or
(ii) both:
(A) the member’s spouse is aged
between the relevant preservation age and 65 years; and
(B) the member’s spouse
satisfies the condition of release specified in item 101 of Schedule 1.
(3) Despite paragraph (2) (c), an application is
not taken to be invalid under that paragraph if the application includes a
statement by the member’s spouse to the effect that, at the time of
application, the spouse:
(a) is aged less than the relevant preservation
age; or
(b) both:
(i) is aged between the relevant
preservation age and 65 years; and
(ii) does not satisfy the condition of
release specified in item 101 of Schedule 1.
(4) The applicant must specify, in the application, the
amount of the benefit from the following:
(a) the member’s taxed splittable contributions;
(b) the member’s
untaxed splittable contributions; that the member seeks to split for the
benefit of the member’s spouse.
(c) the member’s untaxed splittable employer
contributions;
Note An amount rolled over, transferred or
allotted under this Division is a contributions‑splitting superannuation
benefit.
6.45 Decision
on application
(1) A trustee may accept an application made under
subregulation 6.44 (1) if all of the following conditions are satisfied:
(a) the application complies with regulation
6.44;
(b) the
trustee has no reason to believe that the statement mentioned in subregulation
6.44 (3) is untrue;
(c) the
amount to which the application relates is not
more than the maximum splittable amount for
the relevant financial year.
Note A superannuation fund trustee may
voluntarily provide a service that allows a member to rollover, transfer or
allot an amount to the applicant’s spouse (a splittable contribution).
The fund is not required to offer the service.
(2) A trustee
that accepts an application in accordance with subregulation (1) must as soon
as practicable, and in any case within 90 days after receiving the
application, roll over, transfer or allot the amount of benefits for the
benefit of the receiving spouse.
(3) If the application requests a split of untaxed
splittable contributions, the trustee may give effect to the application only if
the amount specified in the application is no more than the crystallised segment that would form part of the
superannuation interest that would be payable if the member withdrew the
member’s entire benefits at the time of the trustee giving effect to the
application.
(4) If the application requests a split of taxed
splittable contributions, the trustee may give effect to the application only if
the amount specified in the application is no more than the element taxed in the fund of the taxable component that
would form part of the superannuation benefit that would be payable if
the member withdrew the member’s entire benefits at the time of the trustee
giving effect to the application.
(5) If the application requests a split of untaxed
splittable employer contributions, the trustee may give effect to the application
only if the amount specified in the application is no more than the element untaxed in the fund of the taxable component that
would form part of the superannuation benefit that would be payable if
the member withdrew the member’s entire benefits at the time of the trustee giving
effect to the application.
6.46 Receiving
spouse
For this Part, if a trustee accepts an application
made under subregulation 6.44 (1), the applicant’s spouse is a receiving
spouse.
Part 7 Contribution and benefit accrual standards (regulated
superannuation funds)
Division 7.1 General
7.01 Interpretation
(1) In this Division, a reference to the accrual of
benefits in a fund does not include:
(a) allocations of investment earnings or
charging of costs; or
(b) benefits rolled over or transferred into the
fund.
(1A) In this Division:
child means an individual who is under age
18.
(2) Expressions used in this Division that are defined
for the purposes of Part 5 have the same meanings respectively as in that Part.
(3) In this Part, a person is gainfully employed on a
part‑time basis during a financial year if the person was gainfully employed for at least 40 hours in
a period of not more than 30 consecutive days in that financial year.
Note Gainfully employed is
defined in regulation 1.03.
7.02 Application of Division 7.1
This Division applies only to regulated
superannuation funds.
7.03 Restriction
on accepting contributions or granting benefit accruals
(1) For the purposes of subsection 31 (1) of the
Act, the requirement in subregulation (2) is a standard applicable to the
operation of a regulated superannuation fund to which this Division applies.
(2) Except in accordance
with this Division, a regulated superannuation fund must not:
(a) accept contributions; or
(b) grant an accrual of benefits.
7.03A Acceptance
of contributions — registrable superannuation entities [see Note 2]
(1) For paragraph 31 (2) (d) of the Act, the
standard stated in subregulation (2) is applicable to a registrable
superannuation entity that is a regulated superannuation fund.
(2) A trustee of the registrable superannuation entity must
not accept contributions unless the registrable superannuation entity is
registered under Part 2B of the Act.
7.04 Acceptance of contributions — regulated superannuation
funds
(1) A regulated superannuation
fund may accept contributions only in accordance with the following table and
subregulations (2), (3), (4) and (6).
|
Item
|
If the member …
|
the fund may accept …
|
|
1
|
is under 65
|
contributions that are made in respect of the member
|
|
2
|
is not under 65, but is under 70
|
contributions that are made in
respect of the member that are:
(a) mandated employer contributions; or
|
|
|
|
(b) if the member has been gainfully employed on at
least a part‑time basis during the financial year in which the
contributions are made:
(i) employer contributions (except mandated
employer contributions); or
(ii) member contributions; or
|
|
|
|
(c) payments from an FHSA of a kind mentioned in
subparagraph 31 (1) (b) (i) or (ii) of the FHSA Act
|
|
3
|
is not under 70, but is under 75
|
contributions that are made in respect of the member that
are:
(a) mandated employer contributions; or
(b) if the member has been gainfully employed on at
least a part‑time basis during the financial year in which the
contributions are made — contributions received on or before the day
that is 28 days after the end of the month in which the member turns 75 that
are:
(i) employer contributions (except mandated
employer contributions); or
(ii) member contributions made by the member
|
|
4
|
is not under 75
|
mandated employer contributions
|
(2) In addition to
subregulation (1), the regulated superannuation fund must not accept any member
contributions if the member’s tax file number has not been quoted (for
superannuation purposes) to the trustee of the fund.
(3) In addition to subregulation (1), the regulated
superannuation fund must not accept any fund‑capped contributions in a
financial year in respect of a member that exceed:
(a) if the member is 64 or less on 1 July of the
financial year — three times the amount of the non‑concessional
contributions cap; or
(b) if the member is 65 but less than 75 on 1
July of the financial year — the non‑concessional contributions cap.
(4) If a regulated
superannuation fund receives an amount in a manner that is inconsistent with
subregulation (1), (2) or (3):
(a) the fund must return the amount to the
entity or person that paid the amount within 30 days of becoming aware
that the amount was received in a manner that is inconsistent with
subregulation (1), (2) or (3), unless:
(i) for an
amount received in a manner that is inconsistent with subregulation (2) —
the member’s tax file number is quoted (for superannuation purposes) within 30
days of this amount being received by the trustee of the fund; or
(ii) for an
amount received in a manner that is inconsistent with subregulation (3) —
a valid notice under section 290‑170 of the Income Tax Assessment Act
1997 is received by the trustee of the fund within 30 days of this amount
being received by the trustee of the fund; and
(b) the fund is also authorised to take any of
the following action to the extent that the rules of the fund allow:
(i) if the
price at which the interest could have been acquired on the day on which the amount
is returned is less than the price on the day on which the interest was
acquired, the amount that would otherwise be returned to the entity or
person that paid the amount may be reduced by the
amount of the difference between the prices;
(ii) if the price
at which the interest could have been acquired on the day of return of the
amount is greater than the price on the day on which the interest was acquired,
the amount that would otherwise be returned to the entity or person that
paid the amount may be increased by the amount of the
difference between the prices;
(iii) if the price at which the
interest could be acquired cannot be determined in accordance with the contract
or legal relationship on the day on which the amount is returned, the price is
to be determined:
(A) on
the basis of the most recent day on which a price was calculated in accordance
with the contract or legal relationship; or
(B) if
there is no day of that kind — as soon as practicable after the decision
is made to return the amount;
(iv) in addition to subparagraph (i),
the amount that would, but for this subparagraph, be returned to the entity or
person that paid the amount may be reduced to account for reasonable
administration costs and transaction costs, incurred by the fund, that:
(A) are
reasonably related to the acquisition of the interest and the return of the
amount; and
(B) do
not exceed the true cost of an arms’ length transaction;
other
than costs related to commissions or similar benefits;
(v) if:
(A) the
interest is a risk insurance interest, or the part of an interest that is a
risk insurance interest; and
(B) the
interest has been issued for a specific period, or the premium for the interest
has been paid in relation to cover for a specific period; and
(C) a
proportion of the specific period has already passed when the decision is made
to return the amount to the entity or person that paid the amount;
the
amount that would otherwise be returned to the entity or person that
paid the amount may be reduced by the sum of:
(D) that part of any amount
received in a manner inconsistent with subregulation (1), (2) or (3) as has
been paid by the fund to any person in connection with the risk insurance
product and which is not recoverable by the fund from that person; and
(E) the proportion equal to
the proportion of the period that has passed of the difference between the
amount that would otherwise be returned and the amount referred to in (a).
(5) If a regulated
superannuation fund acts under subregulation (4), the fund is taken not to
have contravened the Act or these Regulations in relation to the acceptance of
the amount or in relation to the return of the amount to the entity or
person that paid the amount of the fund.
(6) A regulated superannuation
fund may accept contributions in respect of a member if the trustee is
reasonably satisfied that the contribution is in respect of a period during
which, under an item in the table in subregulation (1), the fund may accept the
contribution in respect of that member, even though the contribution is
actually made after that period.
(7) In this regulation:
administration costs has the same meaning as in subregulation 5.01 (1).
employer contributions has the same meaning as in subregulation 1.03 (1).
FHSA has the meaning given by section 8 of
the FHSA Act.
mandated employer
contributions has the same meaning as
in subregulation 5.01 (1).
member contributions has the same meaning as in subregulation 5.01 (1).
fund‑capped
contributions means the member contributions described in the
definition of that expression in subregulation 5.01 (1), other than the
following:
(a) a contribution to
which a valid and acknowledged notice under section 290‑170 of the Income
Tax Assessment Act 1997 relates;
(b) a contribution that
meets the requirements of paragraph 292‑95 (1) (d) of the Income
Tax Assessment Act 1997;
(c) a contribution
that meets the requirements of subsection 292‑100 (9) of the Income
Tax Assessment Act 1997;
(d) a payment made by
the Commissioner of Taxation under section 65 of the Superannuation
Guarantee (Administration) Act 1992;
(e) a payment made by
the Commissioner of Taxation under section 61 or 61A of the Small
Superannuation Accounts Act 1995;
(f) a Government co‑contribution
made under the Superannuation (Government Co‑contribution for Low
Income Earners) Act 2003;
(g) a contribution
that is a directed termination payment within the meaning of section 82‑10F
of the Income Tax (Transitional Provisions) Act 1997.
non‑concessional
contributions cap means the amount
mentioned in subsection 292‑85 (2) of the Income Tax Assessment
Act 1997.
quoted (for superannuation
purposes) has the same meaning as in
the Income Tax Assessment Act 1997.
superannuation provider
means:
(a) the trustee of a
complying superannuation fund; or
(b) the trustee of a
constitutionally protected fund, within the meaning of the Income Tax
Assessment Act 1997.
tax file number has the meaning given by section 299W of the Act.
transaction costs
means any of the following:
(a) brokerage paid
because of an investment transaction;
(b) a cost arising from
maintenance of a property investment;
(c) stamp duty on an
investment transaction.
7.04A Acceptance
of contributions — public offer superannuation funds
(1) For paragraph 31 (2) (d) of the Act, the standard
mentioned in subregulation (2) applies to a regulated superannuation fund that
is a public offer superannuation fund.
(2) If:
(a) a person is a member of a standard employer‑sponsored
fund; and
(b) the
person is employed by another employer (the new employer) who is
not a standard employer‑sponsor of the fund;
the fund must not make its acceptance of contributions from the new
employer in respect of the member conditional upon the new employer becoming a
standard employer‑sponsor of the fund.
7.05 Accrual of benefits — defined benefit funds
(1) Subject to subregulation
(5), a defined benefit fund may grant an accrual of benefits in respect of a
member of the fund who is under age 65.
(2) Subject to subregulation (5), a defined benefit
fund may grant an accrual of benefits in respect of a member of the fund who
has reached age 65 but not age 70 only if:
(a) the accrual is
attributable to mandated employer contributions; or
(b) the member has been
gainfully employed on at least a part‑time basis during the financial
year in which the contributions are made.
(3) Subject to subregulation (5), a defined benefit
fund may grant an accrual of benefits in respect of a member of the fund who
has reached age 70 but not age 75 only if:
(a) the accrual is
attributable to mandated employer contributions; or
(b) the accrual is attributable to:
(i) contributions
made by the member in respect of the member; or
(ii) contributions
made by the employer that are not mandated employer contributions;
and the member
has been gainfully employed on at least a part‑time basis during the
financial year in which the contributions are made.
(4) Subject to subregulation
(5), a defined benefit fund may grant an accrual of benefits in respect of a
member who has reached age 75 only if the accrual is attributable to mandated
employer contributions.
(5) A defined benefit fund may
grant an accrual of benefits in respect of a member if the trustee is
reasonably satisfied that the accrual is in respect of a period during which,
under subregulation (1), (2), (3) or (4), the fund may grant an accrual of
benefits in respect of that member, even though the grant occurs after that
period.
Division 7.2 Contributions to be allocated to members — accumulation
funds
7.06 Application
of Division 7.2
This Division applies only to an accumulation interest.
7.07 Operating
standard
For subsection 31 (1) of the Act, a
requirement set out in this Division is a standard applicable to the operation
of regulated superannuation funds.
7.08 Contributions to be allocated to members
(1) If, on or before 31 May
2008, the trustee of a defined benefit fund receives a contribution in a month
in relation to an accumulation interest, the trustee must allocate the
contribution to a member of the fund by 30 June 2008.
(2) If a trustee receives a contribution in a month in
relation to an accumulation interest, and subregulation (1) does not apply, the
trustee must allocate the contribution to a member of the fund:
(a) within 28 days after
the end of the month; or
(b) if it is not
reasonably practicable to allocate the contribution to the member of the fund
within 28 days after the end of the month — within such longer period as
is reasonable in the circumstances.
Division 7.3 Contributions to
be allocated to members — certain other regulated superannuation funds
7.09 Application of Division 7.3
This Division applies
only to a regulated superannuation fund that is required to allocate
contributions in accordance with regulation 292‑170.03 of the Income
Tax Assessment Regulations 1997.
7.10 Operating standard
For subsection 31 (1)
of the Act, a requirement set out in this Division is a standard applicable to
the operation of regulated superannuation funds that are required to allocate
contributions in accordance with regulation 292‑170.03 of the Income
Tax Assessment Regulations 1997.
7.11 Contributions to be allocated to members
If a trustee is
required to allocate a contribution in a month in accordance with regulation
292‑170.03 of the Income Tax Assessment Regulations 1997, the trustee must allocate the contribution to a member of
the fund:
(a) within 28 days
after the end of the month; or
(b) if it is not
reasonably practicable to allocate the contribution to the member of the fund
within 28 days after the end of the month — within such longer period as
is reasonable in the circumstances.
Part 7A Superannuation
interests subject to payment split
Division 7A.1 General
7A.01 Purpose
of Part 7A
The purpose of this Part is:
(a) to facilitate the payment splitting
arrangements established under Part VIIIB of the Family Law Act 1975;
and
(b) to provide for additional options that may be
exercised in relation to superannuation interests that are subject to a payment
split under that Act.
7A.01A Relevant
condition of release
In this Part:
(a) relevant
condition of release means a condition of release mentioned in item
101, 102, 103, 106, 201, 202, 203 or 206 of Schedule 1; and
(b) a non‑member spouse satisfies a
relevant condition of release if the event specified in the condition has
occurred in relation to the non‑member spouse; and
(c) in the application of item 101, 103, 201 or
203 of Schedule 1 to a non‑member spouse, a reference to a member in:
(i) the
definition of permanent incapacity in subregulation 6.01 (2);
or
(ii) the
definition of retirement in subregulations 6.01 (2)
and (7);
is taken to be a
reference to the non‑member spouse.
7A.02 Operating
standards
For subsections 31 (1) and 32 (1) of the
Act, the standards set out in this Part are applicable to the operation of
regulated superannuation funds and approved deposit funds.
7A.03 Trustee
to give payment split notice
(1) If an interest in a regulated superannuation fund or
an approved deposit fund becomes subject to a payment split, the trustee of the
fund must notify the member spouse and the non‑member spouse in relation
to the interest that the interest is subject to a payment split.
(2) The notice must:
(a) be in writing; and
(b) state the date on which it is given.
(3) The notice must be
given:
(a) for a payment split under a superannuation
agreement or flag lifting agreement — within 28 days after the
operative time for the payment split; and
(b) for a payment split under a splitting
order — by the later of:
(i) the end of 28 days after the
operative time for the payment split; and
(ii) the end of 28 days after the
trustee receives a copy of the order.
(4) Despite subregulation (1), the trustee is not
required to give a payment split notice in respect of an interest if the
interest ceases to be subject to a payment split:
(a) before the end of the period applying under
subregulation (3); and
(b) for a reason other than the creation of a non‑member
spouse interest under regulation 7A.03B.
Note A non‑member spouse may also
be entitled to information under section 1017C of the Corporations Act 2001,
Division 2.5 and Division 2.5A.
Division 7A.1A Options for trustee in relation to interests
7A.03A Application
of Division 7A.1A
(1) This Division
applies in relation to a superannuation interest (the original interest)
in a regulated superannuation fund, if:
(a) the original interest is subject to a
payment split; and
(b) an allocated pension or market linked pension
is being paid in respect of the original interest; and
(c) the trustee:
(i) has not received a request under
regulation 7A.05, 7A.06 or 7A.07; and
(ii) has not taken an action under
regulation 7A.10 in relation to the original interest.
(2) Subject to subregulation
(3), this Division also applies in relation to a superannuation interest (the original
interest) in a regulated superannuation fund, if:
(a) the original
interest is subject to a payment split; and
(b) the original interest is an accumulation
interest in the growth phase; and
(c) the trustee:
(i) has not
received a request under regulation 7A.05, 7A.06 or 7A.07; and
(ii) has not
taken an action under regulation 7A.10 in relation to the original interest.
(3) This Division does not
apply to an accumulation interest:
(a) if:
(i) the
interest is a partially vested accumulation interest; and
(ii) the
transferable benefits in relation to the accumulation interest would be greater
than the withdrawal benefit in relation to the member spouse; or
(b) if the interest is
determined by reference to a policy of life insurance mentioned in regulation
5.15D.
7A.03B Trustee
may create a new interest
(1) The trustee may, at or after the operative time for
the payment split, create a new interest for the non‑member spouse (the non‑member
spouse interest) in the regulated superannuation fund.
(2) If a trustee creates a non‑member spouse
interest under subregulation (1), the person known as the non‑member
spouse at the operative time will continue to be a non‑member spouse for
the purposes of Part 7A until the trustee takes an action under regulation 7A.03H,
7A.03I, 7A.03J or 7A.03K.
(3) Subject to subregulation
(4), the value of the benefits in the non‑member spouse interest must be:
(a) if:
(i) the
payment split is a base amount payment split; and
(ii) an
adjusted base amount applies in relation to the non‑member spouse when
the interest is created;
the adjusted base
amount allocated to the non‑member spouse less the amount of any fees
payable by the non‑member spouse in respect of the payment split; or
(b) if:
(i) the
payment split is a base amount payment split; and
(ii) an
adjusted base amount does not apply in relation to the non‑member spouse
when the interest is created;
the base amount
allocated to the non‑member spouse, within the meaning of regulation 45
of the Family Law (Superannuation) Regulations 2001, less the amount of
any fees payable by the non‑member spouse in respect of the payment
split; or
(c) if the
payment split is a percentage payment split:
(i) for
an entitlement in respect of an interest in a self‑managed superannuation
fund — the amount in relation to the interest at the time when the new
interest is created, determined by a method that a court might use if the court
were acting under paragraph 90MT (2) (b) of the Family Law Act 1975,
multiplied by the specified percentage, less the amount of any fees payable by
the non‑member spouse in respect of the payment split; or
(ii) for an
entitlement in respect of an accumulation interest in the growth phase, other than a partially‑vested accumulation interest,
to which subparagraph (i) does not apply — the amount in relation to the
interest at the time when the new interest is created, determined in the way in
which a court would determine an amount in accordance with regulation 28 and
subregulation 31 (2A) of the Family Law (Superannuation) Regulations
2001, multiplied by the specified percentage, less the amount of any fees
payable by the non‑member spouse in respect of the payment split; or
(iii) for an
entitlement in respect of any other interest — the amount in relation to
the interest at the time when the new interest is created, determined in the
way in which a court would determine an amount in accordance with the relevant
method in Part 5 of the Family Law (Superannuation) Regulations 2001,
multiplied by the specified percentage, less the amount of any fees payable by
the non‑member spouse in respect of the payment split.
(4) The value of the benefits in the non‑member
spouse interest must not be more than the value of the withdrawal benefit in
relation to the member spouse and the original interest immediately before the new interest is created.
(5) The value of the benefits that the member spouse has
in his or her interest must be reduced by the sum of:
(a) the value of the benefits that the non‑member
spouse has in the new interest; and
(b) the amount of any fees payable by the non‑member
spouse in respect of the payment split.
(6) In
creating the new interest:
(a) a proportion must
be taken from the unrestricted non‑preserved benefits, the restricted non‑preserved
benefits and the preserved benefits of the member spouse; and
(b) the proportion taken from each category of
benefits must be the same as the category bears to the member spouse’s interest
immediately before the new interest was created.
(6A) The benefits held in the non‑member
spouse interest are:
(a) if the original
interest is in the growth phase — unrestricted non‑preserved
benefits, restricted non‑ reserved benefits or preserved benefits in
accordance with the character that they had in the member spouse’s interest;
and
(b) if the original interest is an allocated
pension or market linked pension — unrestricted non‑preserved
benefits.
(7) At the time that the payment split notice is given
or, if a payment split notice is not required, within 28 days after the later
of:
(a) the operative time; and
(b) the time when the trustee creates the non‑member
interest;
the trustee must give to the member spouse and the non‑member
spouse a written notice stating:
(c) that the new interest has been created; and
(d) that the value of the original interest has
been reduced; and
(e) the amount of the non‑member spouse
interest.
7A.03C Request
to retain a non‑member spouse interest
The non‑member spouse may request the trustee
to retain in the regulated superannuation fund the non‑member
spouse’s benefits in the non‑member spouse interest.
7A.03D Request
to roll over or transfer benefits
(1) The non‑member spouse may request the trustee
to roll over or transfer the withdrawal benefit from the non‑member
spouse interest to another regulated superannuation fund, or to an approved
deposit fund, EPSSS or RSA, specified in the request, to be held for the
benefit of the non‑member spouse.
(2) If the original interest is in a self‑managed
superannuation fund, the non‑member spouse or the member spouse may
request the trustee to roll over or transfer the withdrawal benefit from the
non‑member spouse interest to another regulated superannuation fund, or
to an approved deposit fund, EPSSS or RSA, specified in the request, to be held
for the benefit of the non‑member spouse.
7A.03E Request
for lump sum payment
If:
(a) the non‑member
spouse has satisfied a relevant condition of release; or
(b) the original interest:
(i) is an allocated
pension or market linked pension; or
(ii) comprises
only unrestricted non‑preserved benefits;
the non‑member spouse may request the trustee to pay the
withdrawal benefit from the non‑member spouse interest to the non‑member
spouse as a lump sum.
7A.03F Requirements
for requests
(1) A request by a person under this Division must be
made:
(a) before the end of 28 days after the trustee
gives a payment split notice to the person; or
(b) if the trustee allows a longer period, before
the end of the longer period allowed.
(2) The request must be made by written notice given to
the trustee.
(3) The notice must:
(a) be signed by the person making the request;
and
(b) state the date when it is given to the
trustee; and
(c) include the name, date of birth and postal
address of the person making the request; and
(d) for a request made by the member spouse,
include a written nomination by the non‑member spouse of the regulated
superannuation fund, approved deposit fund, EPSSS or RSA specified in the
request.
(4) The trustee may allow the request to be withdrawn.
7A.03G Giving
effect to a request
(1) This regulation applies if a trustee receives a
request under this Division within the time allowed under subregulation
7A.03F (1).
(2) The trustee must give effect to the request unless:
(a) the trustee has received an earlier request
under this Division in respect of the same interest and the earlier request has
not been withdrawn; or
(b) for a request under regulation 7A.03C:
(i) the regulated superannuation fund
in which the non‑member spouse interest is held has fewer than
5 members; or
(ii) the governing rules of the
regulated superannuation fund in which the non‑member spouse interest is
held do not allow the non‑member spouse to retain an interest in the
fund; or
(c) for a request under regulation 7A.03D —
the regulated superannuation fund, approved deposit fund, EPSSS or RSA
specified in the request does not accept the rollover or transfer of benefits
for the non‑member spouse.
(3) If
subparagraph (2) (b) (i) applies in relation to a request, the
trustee must:
(a) retain the new
interest in accordance with the request; or
(b) roll over or transfer the withdrawal benefits
to:
(i) another
regulated superannuation fund, approved deposit fund, EPSSS or RSA nominated by
the non‑member spouse; or
(ii) an
eligible rollover fund.
(3A) If
subparagraph (2) (b) (ii), or paragraph (2) (c), applies in relation to a
request, the trustee must roll over or transfer the withdrawal benefits to:
(a) another regulated
superannuation fund, approved deposit fund, EPSSS or RSA nominated by the non‑member
spouse; or
(b) an eligible rollover fund.
(4) If the amount is rolled over or transferred to an
eligible rollover fund under paragraph (3) (b) or
(3A) (b), the trustee must give to the non‑member spouse,
within 28 days, a written notice stating:
(a) that the benefits have been rolled over or
transferred to an eligible rollover fund; and
(b) the name and contact details of the fund; and
(c) the amount that was rolled over or
transferred.
7A.03H Trustee’s
options if no request is received
(1) If a trustee does not receive a request under this
Division within the time allowed under subregulation 7A.03F (1), the
trustee may:
(a) subject to subregulation (2), roll over or
transfer the withdrawal benefit from the non‑member spouse interest to
another regulated superannuation fund, or to an approved deposit fund, EPSSS or
RSA, nominated by the non‑member spouse (subject to the governing rules
of the other regulated superannuation fund, the approved deposit fund or EPSSS
or the terms and conditions of the RSA) to be held for the benefit of the non‑member
spouse; or
(b) if the trustee does not, within the 28‑day
period specified in paragraph (2) (a), receive from the non‑member
spouse a written notice nominating a regulated superannuation fund, approved
deposit fund, EPSSS or RSA to which the withdrawal benefit from the non‑member
spouse interest may be rolled over or transferred — roll over or transfer
the withdrawal benefit from the non‑member spouse interest to an eligible
rollover fund.
(2) Subject to subregulation
(3A), before rolling over or transferring the amount to a regulated
superannuation fund, approved deposit fund, EPSSS or RSA under paragraph
(1) (a), the trustee must give to the non‑member spouse a written
notice stating that:
(a) the non‑member spouse has 28 days from
the date of the notice in which to nominate, by written notice to the trustee,
a regulated superannuation fund, approved deposit fund, EPSSS or RSA to which
the withdrawal benefit from the non‑member spouse interest may be rolled
over or transferred; and
(b) if the non‑member spouse does not,
within the 28‑day period, nominate a regulated superannuation fund,
approved deposit fund, EPSSS or RSA for that purpose, the trustee will roll
over or transfer the amount to an eligible rollover fund.
(3) A notice given by the trustee under subregulation
(2) must state the name and contact details of the eligible rollover fund to
which the amount may be rolled over or transferred.
(3A) If a trustee:
(a) has made
reasonable attempts to obtain sufficient information about a non‑member
spouse to be able to give a payment split notice; and
(b) has been unable to obtain sufficient
information about the non‑member spouse;
the trustee is permitted to act under
paragraphs (1) (a) and (b) as if those paragraphs did not require the
giving of the payment split notice or the notice under subregulation (2).
Example for paragraph (a)
The trustee may be unable, after
reasonable attempts, to identify an address or location of the non‑member
spouse.
(3B) If a trustee:
(a) proposes to give a
non‑member spouse a notice under subregulation (2); and
(b) has made reasonable
attempts to obtain sufficient information about the non‑member spouse to
be able to give the notice; and
(c) has been unable to
obtain sufficient information about the non‑member spouse;
the trustee is not required to give the
notice, and is permitted to act under paragraphs (1) (a) and (b) as if
those paragraphs did not require the giving of the notice.
Example for paragraph (b)
The trustee may be unable, after
reasonable attempts, to identify an address or location of the non‑member
spouse.
(4) If the trustee does not take an action under
subregulation (1), the trustee must give to the non‑member spouse a
written notice:
(a) confirming that the non‑member spouse
has an interest in the fund; and
(b) informing the non‑member spouse of the
relevant cooling‑off arrangements.
(5) The trustee must take an action under subregulation
(1) or (4) within 6 months after the later of:
(a) the operative time; and
(b) the time when the trustee creates the non‑member
interest.
Note After the new interest in the fund
is confirmed, it is no longer a non‑member spouse interest.
7A.03I Confirming
that the non‑member spouse has an interest in the fund
(1) This regulation applies:
(a) if:
(i) a trustee receives a request under
regulation 7A.03C within the time allowed under subregulation 7A.03F (1); and
(ii) paragraph 7A.03G (2) (b) does not
apply to the request; or
(b) if:
(i) a trustee receives a request under
regulation 7A.03C within the time allowed under subregulation 7A.03F (1); and
(ii) the trustee has, under paragraph
7A.03G (3) (a), retained the new interest in accordance with the request.
(2) The trustee must give to the non‑member spouse
a written notice:
(a) confirming that the non‑member spouse
has an interest in the fund; and
(b) informing the non‑member spouse of the
relevant cooling‑off arrangements.
Note After the new interest in the fund
is confirmed, it is no longer a non‑member spouse interest.
7A.03J Rolling
over or transferring the non‑member spouse’s interest
(1) This regulation applies if a trustee rolls over or
transfers the withdrawal benefit from the non‑member spouse interest:
(a) to give effect to a request under regulation
7A.03D; or
(b) on the trustee’s initiative under
subregulation 7A.03H (1).
(2) The trustee must roll over or transfer the amount as
follows:
(a) if the rollover or transfer is to give
effect to a request under regulation 7A.03D, it must be done within:
(i) 90 days after receiving the
request; or
(ii) any longer period allowed by the
Regulator;
(b) if the rollover or transfer is to be done on
the trustee’s initiative under paragraph 7A.03H (1) (a), it must be
done within 90 days after the trustee receives the nomination from the non‑member
spouse under subregulation 7A.03H (2);
(c) if the rollover or transfer is to be done on
the trustee’s initiative under paragraph 7A.03H (1) (b), it must be
done within 90 days after the end of the 28‑day period mentioned in
subregulation 7A.03H (2).
(3) The trustee must give a notice to the non‑member
spouse, within 28 days after the amount is rolled over or transferred, stating:
(a) that the benefits have been rolled over or
transferred; and
(b) if the rollover or transfer was done on the
trustee’s initiative under paragraph 7A.03H (1) (b) — the name and contact
details of the fund to which the amount was rolled over or transferred; and
(c) the amount that was rolled over or
transferred.
7A.03K Paying
a lump sum
(1) This regulation applies if a trustee pays to a non‑member
spouse, as a lump sum, the withdrawal benefit from the non‑member spouse
interest to give effect to a request under regulation 7A.03E.
(2) The trustee must pay
the lump sum within:
(a) 90 days after receiving the request under
regulation 7A.03E; or
(b) any longer period allowed by the Regulator.
(3) The trustee must give to the non‑member
spouse, within 28 days after the lump sum is paid, a written notice
stating:
(a) that the lump sum has been paid; and
(b) the amount that was paid.
Division 7A.2 Options available for certain superannuation interests
7A.04 Application
of Division 7A.2
(1) This Division applies in relation to a
superannuation interest (the original interest) in a regulated
superannuation fund, or an approved deposit fund, if:
(a) the original interest is subject to a
payment split; and
(b) either:
(i) the original interest is an
accumulation interest that is in the growth phase; or
(ii) an allocated pension or market
linked pension is being paid in respect of the original interest.
(2) This
Division does not apply to an accumulation interest:
(a) if:
(i) the
interest is a partially vested accumulation interest; and
(ii) the
transferable benefits in relation to the accumulation interest would be greater
than the withdrawal benefit in relation to the member spouse; or
(b) if the interest is
determined by reference to a policy of life insurance mentioned in regulation
5.15D.
(3) This Division does not apply to an original interest
if the trustee has created a non‑member spouse interest under regulation
7A.03B.
(4) In this regulation:
partially vested accumulation interest has
the meaning given by regulation 9 of the Family Law (Superannuation)
Regulations 2001.
7A.05 Request
for new interest
The non‑member spouse may request the trustee
to create a new interest for the non‑member spouse in the regulated
superannuation fund or approved deposit fund in which the original interest is
held.
7A.06 Request
for transfer of benefits
(1) The non‑member spouse may request the trustee
to roll over or transfer the transferable benefits to another regulated
superannuation fund or approved deposit fund, or to an EPSSS or RSA, specified
in the request, to be held for the benefit of the non‑member spouse.
(2) If the original interest is in a self managed
superannuation fund, the non‑member spouse, or the member spouse, may
request the trustee to roll over or transfer the transferable benefits to
another regulated superannuation fund or approved deposit fund, or to an EPSSS
or RSA, specified in the request, to be held for the benefit of the non‑member
spouse.
7A.07 Request
for lump sum payment
(1) This regulation applies:
(a) if a non‑member spouse has satisfied a
relevant condition of release at the operative time for the payment split; or
(b) if an allocated pension or market linked
pension is being paid in respect of the original interest; or
(c) if the non‑member spouse’s interest
derives from an original interest that comprises only unrestricted non‑
preserved benefits.
(2) The non‑member spouse may request the trustee
to pay to the non‑member spouse, as a lump sum, the amount to which the
non‑member spouse is entitled under the payment split.
7A.08 Requirements
for requests
(1) A request by a person under this Division must be
made:
(a) before the end of 28 days after the trustee
gives a payment split notice to the person; or
(b) if the trustee allows a longer period, before
the end of the longer period allowed.
(2) The request must be made by written notice given to
the trustee.
(3) The notice must:
(a) be signed by the person making the request;
and
(b) state the date when it is given to the
trustee; and
(c) for a request
by the non‑member spouse, include his or her name, date of birth and
postal address; and
(d) for a request
by the member spouse, include a written nomination by the non‑member
spouse of the regulated superannuation fund, approved deposit fund, EPSSS or
RSA specified in the request.
(4) The trustee may allow the request to be withdrawn.
7A.09 Giving
effect to request
(1) This regulation applies if a trustee receives a
request under this Division within the time allowed under regulation 7A.08.
(2) The trustee must give
effect to the request unless:
(a) the trustee has received an earlier request
under this Division in respect of the same interest and the earlier request has
not been withdrawn; or
(b) for a request under regulation 7A.05:
(i) the regulated superannuation fund
in which the non‑member spouse interest is held has fewer than
5 members; or
(ii) the governing rules of the
regulated superannuation fund or approved deposit fund in which the original
interest is held do not allow a new interest to be created for the non‑member
spouse in the fund; or
(c) for a request under regulation 7A.06 —
the regulated superannuation fund, approved deposit fund, EPSSS or RSA
specified in the request does not accept the rollover or transfer of benefits
for the non‑member spouse.
(3) If
subparagraph (2) (b) (i) applies in relation to a request, the
trustee must:
(a) create the new
interest in accordance with the request; or
(b) roll over or transfer the transferable
benefits to:
(i) another
regulated superannuation fund, approved deposit fund, EPSSS or RSA nominated by
the non‑member spouse; or
(ii) an
eligible rollover fund.
(3A) If
subparagraph (2) (b) (ii), or paragraph (2) (c), applies in
relation to a request, the trustee must roll over or transfer the transferable
benefits to:
(a) another regulated
superannuation fund, approved deposit fund, EPSSS or RSA nominated by the non‑member
spouse; or
(b) an eligible rollover fund.
7A.10 Trustee
options if no request received
(1) If the trustee does not receive a request under
this Division within the time allowed under regulation 7A.08, the trustee
may:
(a) create a new interest for the non‑member
spouse in the regulated superannuation fund or approved deposit fund in which
the original interest is held; or
(b) subject to subregulation (2), roll over or
transfer the transferable benefits to another regulated superannuation fund or
approved deposit fund, or to an EPSSS or an RSA, nominated by the non‑member
spouse (subject to the governing rules of the other regulated superannuation
fund, approved deposit fund or EPSSS or the terms and conditions of the RSA),
to be held for the benefit of the non‑member spouse; or
(c) if the
trustee does not, within the 28‑day period specified in paragraph
(2) (a), receive from the non‑member spouse a written notice
nominating a regulated superannuation fund, approved deposit fund, EPSSS or RSA
to which the transferable benefits may be rolled over or transferred, roll over
or transfer the transferable benefits to an eligible rollover fund.
(2) Subject to subregulation
(4), before rolling over or transferring the transferable benefits to a
regulated superannuation fund, approved deposit fund, EPSSS or RSA under
paragraph (1) (b), the trustee must give to the non‑member spouse a
written notice stating that:
(a) the non‑member spouse has 28 days from
the date of the notice in which to nominate, by written notice to the trustee,
a regulated superannuation fund, approved deposit fund, EPSSS or RSA to which
the transferable benefits may be rolled over or transferred; and
(b) if the non‑member spouse does not,
within that 28‑day period, nominate a regulated superannuation fund,
approved deposit fund, EPSSS or RSA for that purpose, the trustee will roll
over or transfer the transferable benefits to an eligible rollover fund.
(3) A notice given by the trustee under subregulation
(2) must state the name and contact details of the eligible rollover fund to
which the non‑member spouse’s transferable benefits may be rolled over or
transferred.
(4) If a trustee:
(a) has made
reasonable attempts to obtain sufficient information about a non‑member
spouse to be able to give a payment split notice; and
(b) has been unable to obtain sufficient
information about the non‑member spouse;
the trustee is permitted to act under subregulation
(1) as if the subregulation did not require the giving of the payment split
notice or the notice under subregulation (2).
Example for paragraph (a)
The trustee may be unable, after
reasonable attempts, to identify an address or location of the non‑member
spouse.
(5) If
a trustee:
(a) proposes to give a
non‑member spouse a notice under subregulation (2); and
(b) has made reasonable
attempts to obtain sufficient information about the non‑member spouse to
be able to give the notice; and
(c) has been unable to
obtain sufficient information about the non‑member spouse;
the trustee is not required to give the
notice, and is permitted to act under paragraphs (1) (b) and (c) as if
those paragraphs did not require the giving of the notice.
Example for paragraph (b)
The trustee may be unable, after
reasonable attempts, to identify an address or location of the non‑member
spouse.
7A.11 Creating
a new interest
(1) This regulation applies if the trustee creates a
new interest for the non‑member spouse in the regulated superannuation
fund or approved deposit fund in which the original interest is held:
(a) to give effect to a request under regulation
7A.05; or
(b) on the
trustee’s initiative under paragraph 7A.10 (1) (a).
(2) Subject to subregulations (3) and (4), the value of
the benefits that the non‑member spouse has in the new interest must be:
(a) if the payment split is a base amount
payment split and an adjusted base amount applies to the non‑member
spouse when the new interest is created — the adjusted base amount less
the amount of any fees payable by the non‑member spouse in respect of the
payment split; or
(b) if the payment split is a base amount payment
split and an adjusted base amount does not apply to the non‑member spouse
when the new interest is created — the base amount allocated to the non‑member
spouse, within the meaning of regulation 45 of the Family Law
(Superannuation) Regulations 2001, less the amount of any fees payable by
the non‑member spouse in respect of the payment split; or
(c) if the
payment split is a percentage payment split:
(i) for an
entitlement, in respect of an accumulation interest in the growth phase that is not a partially vested accumulation interest, to
which subparagraph (ii) does not apply — the amount in relation to
the interest at the time when the new interest is created, determined in the way in which a court would determine an
amount in accordance with regulation 28 and subregulation 31 (2A) of
the Family Law (Superannuation) Regulations 2001, multiplied by the
specified percentage, less the amount of any fees payable by the non‑member
spouse in respect of the payment split; or
(ii) for an entitlement in respect of
an interest in a self‑managed superannuation fund — the amount in
relation to the interest at the time when the new interest is created,
determined by a method that a court might use if the court were acting under
paragraph 90MT (2) (b) of the Family Law Act 1975, multiplied
by the specified percentage, less the amount of any fees payable by the non‑member
spouse in respect of the payment split; or
(iii) for
an entitlement in respect of any other interest — the amount in relation
to the interest at the time when the new interest is created, determined in the way in which a court would determine an
amount in accordance with the relevant method in Part 5 of the Family
Law (Superannuation) Regulations 2001, multiplied by the specified
percentage, less the amount of any fees payable by the non‑member spouse
in respect of the payment split.
(3) If the payment split is a base amount payment split,
and a splittable payment becomes payable in respect of the member spouse’s
interest before the new interest is created, the value of the benefits that the
non‑member spouse has in the new interest must be the amount applying
under subregulation (2) less the amount the non‑member spouse is entitled
to be paid in respect of the splittable payment.
(4) The value of the
benefits that the non‑member spouse has in the new interest must not be
more than the value of the withdrawal benefit in relation to the member spouse
and the original interest immediately before the new interest
is created.
(5) The value of the benefits that the member spouse
has in his or her interest must be reduced by the sum of:
(a) the value of the benefits that the non‑member
spouse has in the new interest; and
(b) the amount of any fees payable by the non‑member
spouse in respect of the payment split.
(6) In creating the new interest:
(a) a proportion must be taken from the
unrestricted non‑preserved benefits, the restricted non‑preserved
benefits and the preserved benefits of the member spouse; and
(b) the proportion taken from each category of
benefits must be the same as the category bears to the member spouse’s interest
immediately before the new interest was created.
(7) The benefits held in
the new interest are unrestricted non‑preserved benefits, restricted non‑preserved
benefits or preserved benefits in accordance with the character that they had
in the member spouse’s interest.
(8) A new interest created to give effect to a request
under regulation 7A.05 is taken to be created on the day when the trustee
receives the request in accordance with regulation 7A.08.
(9) A new interest created on the trustee’s initiative
under paragraph 7A.10 (1) (a) is taken to be created on the twenty‑ninth
day after the date when the payment split notice in relation to the payment
split was given by the trustee.
(10) The trustee must give to the member spouse and the
non‑member spouse, within 28 days after the new interest is created, a
written notice stating:
(a) that the new interest has been created; and
(b) the amount
allocated to the non‑member spouse in the new interest; and
(c) if the
payment split is a base amount payment split, the amount of any adjustment that
has been made to the base amount since:
(i) if the trustee had previously
provided information to the non‑member spouse under regulation
2.36D — the end of the last completed reporting period; or
(ii) in any other case — the
operative time.
7A.12 Rolling
over or transferring transferable benefits
(1) This regulation applies if the trustee rolls over or
transfers transferable benefits:
(a) to give effect to a request under regulation
7A.06; or
(b) on the trustee’s initiative under paragraph
7A.10 (1) (b) or (c); or
(c) under
subregulation 7A.09 (3) or (3A).
(2) The value of the benefits that the member spouse
has in his or her interest must be reduced by the sum of:
(a) the
value of:
(i) the
transferable benefits; or
(ii) if
paragraph (3A) (c) applies — the benefits that are rolled over or
transferred; and
(b) the amount of any fees payable by the non‑member
spouse in respect of the payment split.
(3) If the payment split is a base amount payment split,
and a splittable payment becomes payable in respect of the member spouse’s
interest before the trustee rolls over or transfers the transferable benefits,
the amount rolled over or transferred
for the non‑member spouse must be the transferable benefits less the
amount the non‑member spouse is entitled to in respect of the splittable
payment.
(3A) In rolling over or transferring the transferable
benefits:
(a) a proportion must be taken from the
unrestricted non‑preserved benefits, the restricted non‑preserved
benefits and the preserved benefits of the member spouse; and
(b) the proportion taken from each category of
benefits must be the same as the category bears to the member spouse’s interest
immediately before the benefits were rolled over or transferred;
and
(c) the trustee must
ensure that the total amount that is rolled over or transferred does not exceed
the withdrawal benefit of the member spouse immediately before that amount is
rolled over or transferred.
(3B) The benefits held in the new interest are unrestricted
non‑preserved benefits, restricted non‑preserved benefits or
preserved benefits in accordance with the character that the benefits had in
the member spouse’s interest.
(4) The trustee must roll over or transfer the
transferable benefits as follows:
(a) if the rollover or transfer is to give
effect to a request under regulation 7A.06, it must be done within:
(i) 90 days after receiving the
request; or
(ii) any longer period allowed by the
Regulator;
(b) if the
rollover or transfer is to be done on the trustee’s initiative under paragraph
7A.10 (1) (b), it must be done within 90 days after the trustee
receives the nomination from the non‑member spouse under subregulation
7A.10 (2);
(c) if the rollover or transfer is to be done on
the trustee’s initiative under paragraph 7A.10 (1) (c), it must be done within
90 days after the end of the 28‑day period mentioned in subregulation
7A.10 (2).
(5) The trustee must give to the member spouse and the
non‑member spouse, within 28 days after the transferable benefits are
rolled over or transferred, a written notice stating:
(a) that the benefits have been rolled over or
transferred; and
(b) the amount that was transferred or rolled
over; and
(c) if the payment split is a base amount
payment split, the amount of any adjustment that has been made to the base
amount since:
(i) if the trustee had previously
provided information to the non‑member spouse under regulation
2.36D — the end of the last completed reporting period; or
(ii) in any other case — the operative time; and
(d) if the benefits are
rolled over or transferred to an eligible rollover fund — the name and contact
details of the fund.
7A.13 Paying
a lump sum
(1) This regulation applies if, to give effect to a
request under regulation 7A.07, the trustee pays to the non‑member
spouse, as a lump sum, the amount to which the non‑member spouse is
entitled under the payment split.
(2) Subject to subregulations (3) and (4), the value of
the lump sum to be paid to the non‑member spouse must be:
(a) if the payment split is a base amount
payment split and an adjusted base amount applies to the non‑member
spouse at the date of the payment — the adjusted base amount less the
amount of any fees payable by the non‑member spouse in respect of the
payment split; or
(b) if the payment split is a base amount payment
split and an adjusted base amount does not apply to the non‑member spouse
at the date of the payment — the base amount allocated to the non‑member
spouse, within the meaning of regulation 45 of the Family Law
(Superannuation) Regulations 2001, less the amount of any fees payable by
the non‑member spouse in respect of the payment split; or
(c) if the payment split is a percentage payment
split:
(i) for an
entitlement, in respect of an accumulation interest in the growth phase that is not a partially vested accumulation interest, to
which subparagraph (ii) does not apply — the amount in relation to
the interest at the date of the payment, determined
in the way in which a court would determine an amount in accordance with
regulation 28 and subregulation 31 (2A) of the Family Law
(Superannuation) Regulations 2001, multiplied by the specified percentage,
less the amount of any fees payable by the non‑member spouse in respect
of the payment split; or
(ii) for an entitlement in respect of
an interest in a self‑managed superannuation fund — the amount in
relation to the interest at the date of the payment, determined by a method
that a court might use if the court were acting under paragraph 90MT (2) (b)
of the Family Law Act 1975, multiplied by the specified percentage, less
the amount of any fees payable by the non‑member spouse in respect of the
payment split; or
(iii) for an entitlement in respect of
any other interest — the amount in relation to the interest at the date of
the payment, determined in the way in which a court
would determine an amount in accordance with the relevant method in Part
5 of the Family Law (Superannuation) Regulations 2001, multiplied by the
specified percentage, less the amount of any fees payable by the non‑member
spouse in respect of the payment split.
(3) If the payment split is a base amount payment split,
and a splittable payment becomes payable in respect of the member spouse’s
interest before the lump sum is paid to the non‑member spouse, the value
of the lump sum to be paid to the non‑member spouse must be the amount
applying under subregulation (2) less the amount the non‑member spouse is
entitled to be paid in respect of the splittable payment.
(4) The value of the lump sum to be paid to the non‑member
spouse must not be more than the value of the withdrawal benefit in relation to
the member spouse and the original interest immediately
before the lump sum is paid.
(5) The value of the benefits that the member spouse
has in his or her interest must be reduced by the sum of:
(a) the value of the lump sum paid to the non‑member
spouse; and
(b) the amount of any fees payable by the non‑member
spouse in respect of the payment split.
(6) In paying the lump
sum to the non‑member spouse:
(a) a proportion must be taken from the
unrestricted non‑preserved benefits, the restricted non‑preserved
benefits and the preserved benefits of the member spouse; and
(b) the proportion taken from each category of
benefits must be the same as the category bears to the member spouse’s interest
immediately before the payment was made.
(7) The trustee must pay the lump sum within:
(a) 90 days after receiving the request under
regulation 7A.07; or
(b) any longer period allowed by the Regulator.
(8) The trustee must give to the member spouse and the
non‑member spouse, within 28 days after the lump sum is paid, a written
notice stating:
(a) that the lump sum has been paid; and
(b) the amount that was paid; and
(c) if the payment split is a base amount
payment split, the amount of any adjustment that has been made to the base
amount since:
(i) if the trustee had previously
provided information to the non‑member spouse under regulation
2.36D — the end of the last completed reporting period; or
(ii) in any other case — the
operative time.
Division 7A.3 Splittable payments — payment standards for non‑member
spouse entitlements
7A.14 Application
of Division 7A.3
(1) This Division applies if:
(a) an interest (the original interest)
in a regulated superannuation fund or approved deposit fund is subject to a
payment split; and
(b) the non‑member spouse is entitled to be
paid an amount from the original interest because a splittable payment in
respect of the interest has become payable; and
(c) a new
interest has not been created for the non‑member spouse, or the
transferable benefits of the non‑member spouse have not been transferred
or rolled out of the fund, as a result of a payment split.
(2) However, if an amount
under the Act would be a superannuation death benefit (within the meaning of
subsection 995‑1 (1) of the 1997 Tax Act) if it were paid to the non‑member
spouse, a requirement in this Division:
(a) to pay the amount;
or
(b) to roll over or transfer the amount to
another regulated superannuation fund, an RSA, an approved deposit fund or an
EPSSS, to be held for the benefit of the non‑member spouse; or
(c) to allocate
the amount to an interest that the trustee
creates for the non‑member spouse in the regulated superannuation fund or
approved deposit fund;
is taken to be a requirement to pay the
amount to the non‑member spouse in cash.
7A.16 Preservation
of non‑member spouse entitlements
(1) Subject to regulation 7A.17, this regulation applies
if:
(a) the non‑member
spouse has not satisfied a relevant condition of release at the time of
the splittable payment; and
(b) the splittable payment does not derive from
an allocated pension or market linked pension.
(2) The trustee of the regulated superannuation fund or
approved deposit fund in which the original interest is held must:
(a) allocate the amount to an interest that the
trustee
creates for the non‑member spouse in the regulated superannuation fund or
approved deposit fund; or
(b) roll over or transfer the amount to another
regulated superannuation fund, an RSA, an approved deposit fund or an EPSSS, to
be held for the benefit of the non‑member spouse.
(2A) The trustee must
preserve the amount mentioned in subregulation (2).
(3) If the non‑member spouse’s entitlement under
the payment split is to be paid as a lump sum, the trustee must allocate, roll
over or transfer the lump sum within:
(a) 90 days after the splittable payment becomes
payable; or
(b) any longer period allowed by the Regulator.
(4) If the non‑member
spouse’s entitlement derives from a pension being paid to the member spouse
(other than a pension to which regulation 7A.17 applies, an allocated pension
or a market linked pension), the trustee must allocate, roll over or transfer
the amounts to which the non‑member spouse is entitled:
(a) if the governing rules of the fund provide
for the frequency with which pension payments are to be made to the member
spouse — in accordance with those rules; or
(b) in any other case — at least annually.
(5) Subject to
subregulation (6), the amount must not be allocated, rolled over or transferred
unless the trustee of the transferor fund:
(a) has received, from the non‑member
spouse, consent to the allocation, rollover or transfer; or
(b) in the case of a
rollover or transfer — believes, on reasonable grounds, that:
(i) the
trustee of the receiving regulated superannuation fund, approved deposit fund
or EPSSS; or
(ii) the
receiving RSA provider;
has received from
the non‑member spouse consent to the rollover or transfer.
(6) If the trustee of the
transferor fund believes, on reasonable grounds and after making reasonable
inquiries, that the non‑member spouse has not given a consent mentioned
in subregulation (5):
(a) the
trustee must:
(i) allocate
the amount to an interest that the trustee creates for the non‑member
spouse in the regulated superannuation fund or approved deposit fund; or
(ii) apply,
under subsection 243 (2) of the Act, for the issue to the non‑member
spouse of an interest in an eligible rollover fund that is a regulated
superannuation fund; and
(b) if subparagraph (a)
(ii) applies — the amount must be rolled over or transferred to that fund.
(7) The consent of the member spouse to a rollover or
transfer under this regulation is not required.
(8) In subregulation (5):
consent means:
(a) written consent; or
(b) any other form of consent determined by the
Regulator as sufficient in the circumstances.
7A.17 Payment
of non‑member spouse entitlements from pension
(1) This regulation applies if:
(a) the non‑member spouse has not
satisfied a relevant condition of release at the time of the splittable
payment; and
(b) the member spouse was being paid a pension
(other than an allocated pension or market linked pension) in respect of the
original interest on or before the operative time for the payment split.
(2) When the splittable payment becomes payable, the
trustee of the regulated superannuation fund or approved deposit fund in which
the original interest is held must pay the amount to which the non‑member
spouse is entitled to the non‑member spouse.
(3) However,
if the amount to be paid to the non‑member spouse is a lump sum payable
as the result of the commutation of a pension, the non‑member spouse may
request the trustee:
(a) to allocate the
amount to an interest that the trustee
creates for the non‑member spouse in the regulated superannuation fund or
approved deposit fund; or
(b) to roll over or transfer the amount to
another regulated superannuation fund, an RSA, an approved deposit fund or an
EPSSS, to be held for the benefit of the non‑member spouse.
(4) The trustee must give
effect to the request unless:
(a) for a request
under paragraph (3) (a):
(i) the regulated superannuation fund
in which the non‑member spouse interest is held has fewer than 5 members;
or
(ii) the governing rules of the
regulated superannuation fund or approved deposit fund in which the original
interest is held do not allow a new interest to be created for the non‑member
spouse in the fund; or
(b) for
a request under paragraph (3) (b) — the regulated superannuation
fund, approved deposit fund, EPSSS or RSA specified in the request does not
accept the rollover or transfer of benefits for the non‑member spouse.
(5) If subparagraph (4) (a) (i)
applies:
(a) the trustee may
give effect to the request; or
(b) if the trustee does not give effect to the
request, the trustee must:
(i) if the
non‑member spouse asks the trustee to pay the amount to which the non‑member
spouse is entitled to the non‑member spouse — pay the amount; or
(ii) in any other case — roll
over or transfer the amount to which the non‑member spouse is entitled
to:
(A) another
regulated superannuation fund, approved deposit fund, EPSSS or RSA nominated by
the non‑member spouse; or
(B) an
eligible rollover fund.
(6) If
subparagraph (4) (a) (ii) or paragraph (4) (b) applies, the trustee must:
(a) if the non‑member
spouse asks the trustee to pay the amount to which the non‑member spouse
is entitled to the non‑member spouse — pay the amount; or
(b) in any other case — roll over or
transfer the amount to which the non‑member spouse is entitled to:
(i) another
regulated superannuation fund, approved deposit fund, EPSSS or RSA nominated by
the non‑member spouse; or
(ii) an
eligible rollover fund.
7A.18 Cashing
of non‑member spouse entitlements
(1) This regulation applies if:
(a) the non‑member
spouse has satisfied a relevant condition of release at the time of the
splittable payment; or
(b) the splittable payment derives from an
allocated pension or market linked pension.
(2) When the splittable
payment becomes payable, the trustee must:
(a) pay the amount to
which the non‑member spouse is entitled; or
(b) if the splittable payment is not a pension
payment, and the non‑member spouse asks the trustee to allocate the
amount to which the non‑member spouse is entitled to an interest the
trustee is to create for the non‑member spouse in the regulated
superannuation fund or approved deposit fund in which the original interest is
held — give effect to the request unless:
(i) the
regulated superannuation fund in which the non‑member spouse interest is
held has fewer than 5 members; or
(ii) the
governing rules of the regulated superannuation fund or approved deposit fund
in which the original interest is held do not allow a new interest to be
created for the non‑member spouse in the fund; or
(c) if the
splittable payment is not a pension payment, and the non‑member spouse
asks the trustee to roll over or transfer the amount
to which the non‑member spouse is entitled to another regulated
superannuation fund, an RSA, an approved deposit fund or an EPSSS, nominated by
the non‑member spouse, to be held for the benefit of the non‑member
spouse — give effect to the request unless the regulated superannuation
fund, approved deposit fund, EPSSS or RSA specified in the request does not
accept the rollover or transfer of benefits for the non‑member spouse.
(3) If subparagraph (2) (b) (i)
applies:
(a) the trustee may
give effect to the request; or
(b) if the trustee does not give effect to the
request, the trustee must:
(i) if the
non‑member spouse asks the trustee to pay the amount to which the non‑member
spouse is entitled to the non‑member spouse — pay the amount to
which the non‑member spouse is entitled; or
(ii) in
any other case — roll over or transfer the amount to which the non‑member
spouse is entitled to:
(A) another
regulated superannuation fund, approved deposit fund, EPSSS or RSA nominated by
the non‑member spouse; or
(B) an
eligible rollover fund.
(4) If subparagraph (2) (b) (ii)
or paragraph (2) (c) applies, the trustee must:
(a) if the non‑member
spouse asks the trustee to pay the amount to which the non‑member spouse
is entitled to the non‑member spouse — pay the amount to which the
non‑member spouse is entitled; or
(b) in any other case — roll over or
transfer the amount to which the non‑member spouse is entitled to:
(i) another
regulated superannuation fund, approved deposit fund, EPSSS or RSA nominated by
the non‑member spouse; or
(ii) an
eligible rollover fund.
Division 7A.4 Superannuation interest split under the Family Law
(Superannuation) Regulations 2001
7A.19 Application
This Division applies if a trustee of a
superannuation fund:
(a) creates a new interest in the fund for a non‑member
spouse to satisfy regulation 14G of the Family Law (Superannuation)
Regulations 2001; or
(b) transfers or rolls over to another
superannuation fund or RSA an amount, to be held for the benefit of a non‑member
spouse to satisfy regulation 14G of the Family Law (Superannuation)
Regulations 2001; or
(c) pays an amount to a non‑member spouse
to satisfy regulation 14G of the Family Law (Superannuation) Regulations
2001.
7A.20 Creating
a new interest
(1) This regulation applies if the trustee creates a new
interest in the fund for the non‑member spouse.
(2) In creating the new interest:
(a) a proportion must be taken from the
unrestricted non‑preserved benefits, the restricted non‑preserved
benefits and the preserved benefits of the member spouse; and
(b) the proportion taken from each category of
benefits must be the same as the category bears to the member spouse’s interest
immediately before the interest was created.
(3) The benefits held in the new interest are
unrestricted non‑preserved benefits, restricted non‑preserved
benefits or preserved benefits in accordance with the character that they had
in the member spouse’s interest.
7A.21 Rolling
over or transferring benefits
(1) This regulation applies if the trustee rolls over or
transfers to another superannuation fund or RSA an amount to be held for the
benefit of the non‑member spouse.
(2) In rolling over or transferring the transferable
benefits:
(a) a proportion must be taken from the
unrestricted non‑preserved benefits, the restricted non‑preserved
benefits and the preserved benefits of the member spouse; and
(b) the proportion taken from each category of
benefits must be the same as the category bears to the member spouse’s interest
immediately before the amount was rolled over or transferred.
(3) The benefits held in the new interest are
unrestricted non‑preserved benefits, restricted non‑preserved
benefits or preserved benefits in accordance with the character that the
benefits had in the member spouse’s interest.
7A.22 Paying
an amount
(1) This regulation applies if the trustee pays an
amount to the non‑member spouse.
(2) In paying the amount to the non‑member spouse:
(a) a proportion must be taken from the
unrestricted non‑preserved benefits, the restricted non‑preserved
benefits and the preserved benefits of the member spouse; and
(b) the proportion taken from each category of
benefits must be the same as the category bears to the member spouse’s interest
immediately before the amount was paid.
Part 8 Financial
reporting
8.01 Accounts —
statement of financial position and financial statement
(1) For the purposes of paragraphs 35B (1) (a)
and (b) of the Act (preparation of a statement of financial position and an
operating statement), this regulation specifies cases where those paragraphs do
not apply.
Defined benefit funds and accumulation funds that prepare certain
statements
(2) Those paragraphs do not apply in the case of:
(a) a defined benefit fund in respect of a year
of income of the fund; or
(b) an accumulation fund in respect of the 1994‑1995
year of income of the fund;
if the trustee of the fund prepares:
(c) a statement of net assets of the entity; and
(d) a statement of changes in net assets of the
entity;
in respect of that year of income.
Superannuation funds where benefits are determined by reference to
a life assurance policy
(3) Those paragraphs do not apply in the case of a regulated
superannuation fund in respect of a year of income of the fund if, at the end
of the year, the fund is a fund from which the benefits paid to each individual
member of the fund:
(a) are wholly determined by reference to
policies of life assurance; or
(b) if paragraph (a) does not apply only because
shares in the life insurance company issuing the policies were acquired because
the company was demutualised:
(i) would otherwise be wholly
determined by reference to policies of life assurance; and
(ii) the shares have been held for no
longer than 18 months from the date of acquisition.
8.02 Accounts
and statements that must be prepared
(1) This regulation is made for the purposes of
paragraph 35B (1) (c) of the Act.
(2) Where, because of subregulation 8.01 (3),
paragraphs 35B (1) (a) and (b) of the Act do not apply in respect of
a regulated superannuation fund in respect of a year of income, the accounts
and statements mentioned in subregulation (3) are specified in respect of the
fund in respect of that year of income.
(3) Those accounts and statements are:
(a) a statement that policies of the kinds
mentioned in subregulation 8.01 (3) are in place at the end of the year of
income; and
(b) a statement as to whether those policies have
been fully maintained as directed by the relevant insurers; and
(c) a statement of the identities of those
insurers; and
(d) the amounts contributed by employers and
members in respect of the year of income; and
(e) where not all of those amounts have been
paid as premiums on the policies — the amount of premiums paid on the
policies in respect of the year of income; and
(f) the expenses incurred by the fund in respect
of the year of income, other than amounts covered by premiums.
8.02A Period
within which an auditor must be appointed (Act s 35C)
For subsection 35C (1) of the Act, the
following periods are prescribed:
(a) for a registrable superannuation
entity — as soon as practicable, but in any event, no later than the last
day of each year of income;
(b) for a self
managed superannuation fund — as soon as practicable but, in any event, no
later than 30 days before the date by which the auditor must give a report
mentioned in subsection 35C (6) of the Act to the trustees of the fund.
Note See regulation 8.03 for the period
within which a report mentioned in subsection 35C (6) of the Act must be
provided.
8.03 Period
within which audit report must be given
For the purposes of subsection 35C (6) of the
Act, the period within which a report mentioned in that subsection must be
given after the year of income to which it relates is:
(a) if the report is in respect of a self
managed superannuation fund — the period ending on the day before the day
by which section 35D of the Act requires a return to be lodged in respect of a
self managed superannuation fund; or
(b) if the report is for a public offer
entity — 4 months; or
(c) if the report is for any other
superannuation entity:
(i) for a year of income that ends
before 30 June 2000 — 6 months; and
(ii) for a year of income that ends on
or after 30 June 2000 — 4 months.
8.04 Period
within which audit report is given to the APRA (Act s 36)
For subsection 36 (1) of the Act, the
prescribed period is as soon as practicable but, in any event, no later than 4
months after the year of income to which that report relates.
Part 9 Financial management of funds
Division 9.1 Introductory
9.01 Interpretation
In this Part:
funding and solvency certificate means a
certificate required under regulation 9.09.
Division 9.2 Financial position of funds
9.02 Application
This Division applies only to superannuation
entities other than:
(a) funds that are part of one of the following
schemes:
(i) the scheme established by the Superannuation
Act 1976;
(ii) the scheme established under the
provisions of the Superannuation Act 1990;
(iii) the Military Superannuation and
Benefits Scheme; and
(b) funds that are part of an exempt public
sector superannuation scheme.
9.02A Interpretation
A reference in this Division to:
(a) benefits vested in a member of a fund; or
(b) aggregate benefit accounts of a member of a
fund; or
(c) benefits accrued to a member of a fund; or
(d) obligations of
a fund in respect of a member;
includes any amounts that would be payable to the member’s spouse
or former spouse under a payment split.
9.03 Subsection
130 (1) of the Act etc — obligations of actuaries and auditors
(1) In forming an opinion for the purposes of paragraph
130 (1) (a) of the Act or subregulation 9.31 (3) whether the
financial position of a defined benefit fund may be about to become
unsatisfactory, a person must consider whether, at the end of the 3‑year
period immediately following the date at which the person’s calculations are
done, the value of the assets of the fund is likely (based on the expectations
referred to in subregulation (2)) to be inadequate to meet the value of such of
the liabilities of the fund as relate to the benefits vested in the members of
the fund.
(2) For the purposes of subregulation (1), the
likelihood of the value of assets being inadequate must be based;
(a) if the person considering the matter is an
actuary — on the actuary’s reasonable expectations; and
(b) if the person considering the matter is an
auditor — on the reasonable expectation of an actuary on whose advice the
auditor has relied in relation to the matter.
(3) Nothing in subregulations (1) and (2) is to be taken
to affect the meaning of paragraph 130 (1) (a) of the Act.
(4) For the purposes of paragraph 130 (1) (b)
of the Act, if an actuary in the course of performing a function for an entity
under the Act or these regulations obtains sufficient information to enable the
actuary to assess the financial position of the entity, the actuary is taken to
have performed an actuarial function under the Act or these regulations in
relation to the entity.
(5) For the purposes of paragraph 130 (1) (b)
of the Act, if an auditor in the course of performing a function for an entity
under the Act or these regulations obtains sufficient information to enable the
auditor to assess the financial position of the entity, the auditor is taken to
have performed an audit function under the Act or these regulations in relation
to the entity.
9.04 Subsection
130 (7) of the Act — unsatisfactory financial position
For the purposes of subsection 130 (7) of the
Act and subregulation 9.31 (3), the financial position of an entity is
treated as unsatisfactory if, in the opinion of a person performing an
actuarial or audit function in relation to the entity:
(a) in the case of an entity that is a defined
benefit fund — the value of the assets of the fund is inadequate to cover
the value of the liabilities of the fund in respect of benefits vested in the
members of the fund; and
(b) in the case of an entity that is an
accumulation fund — either:
(i) the assets of the fund are
inadequate to cover the aggregate benefit accounts of members of the fund; or
(ii) the value of the assets of the
fund is inadequate to cover the value of the liabilities of the fund in respect
of benefits accrued to members of the fund; and
(c) in the case of an entity that is an approved
deposit fund — the assets of the fund are inadequate to cover the
obligations of the fund in respect of members of the fund; and
(d) in the case of an entity that is a PST —
the assets of the trust are inadequate to cover the obligations of the trust in
respect of holders of units in the trust.
Division 9.2A Size of defined benefit funds
9.04A Application
(1) This Division applies
to:
(a) a defined benefit fund established after the
commencement of this Division; and
(b) a fund that is converted to a defined benefit
fund after the commencement of this Division; and
(c) a defined benefit fund that wishes to accept
a new defined benefit member after the commencement of this Division; and
(d) a defined benefit fund that wishes to convert
a member of the fund to a defined benefit member after the commencement of this
Division.
(2) This Division does not apply to a fund that is part
of:
(a) the scheme established by the Superannuation
Act 1976; or
(b) the scheme established under the provisions
of the Superannuation Act 1990; or
(c) the Military Superannuation and Benefits
Scheme; or
(d) an exempt public sector superannuation
scheme.
9.04B Sub‑funds
to be treated as funds
A sub‑fund within a defined benefit fund is
taken, for the purposes of this Division, to be a defined benefit fund if the
sub‑fund satisfies the following conditions:
(a) the sub‑fund has separately
identifiable assets and separately identifiable beneficiaries;
(b) the interest of each beneficiary of the sub‑fund
is determined by reference only to the conditions governing that sub‑fund.
9.04C Operating
standard
For subsection 31 (1) of the Act, a
requirement set out in this Division is a standard applicable to the operation
of regulated superannuation funds that are defined benefit funds.
9.04D Size of defined benefit funds
(1) A defined benefit fund established after the
commencement of this Division must have at least 50 defined benefit members.
(2) A fund that is converted to a defined benefit fund
after the commencement of this Division must have at least 50 defined benefit
members.
(3) A defined benefit fund may accept a new defined
benefit member after the commencement of this Division only if the fund will
have at least 50 defined benefit members after accepting the new defined
benefit member.
(4) A defined benefit fund may convert a member of the
fund to a defined benefit member after the commencement of this Division only
if the fund will have at least 50 defined benefit members after converting the
member to a defined benefit member.
Division 9.2B Provision of defined benefit pensions
9.04E Definition for Division 9.2B
In this Division:
defined benefit
pension means a pension under section 10 of the Act, other than:
(a) a pension wholly determined by reference to
policies of life assurance purchased or obtained by the trustee of a regulated
superannuation fund solely for the purposes of providing benefits to members of
that fund; or
(b) an allocated pension; or
(c) a market linked pension;
or
(d) an account‑based
pension.
9.04F Application
of Division 9.2B
(1) This Division applies to:
(a) a regulated superannuation fund established
after the commencement of this Division, the governing rules of which provide
for the payment of a defined benefit pension; and
(b) a regulated
superannuation fund established before the commencement of this Division, the
governing rules of which are amended after the commencement of this Division to
provide for the payment of a defined benefit pension.
(2) This Division does not apply to a fund that is part
of:
(a) the scheme established by the Superannuation
Act 1976; or
(b) the scheme established under the provisions
of the Superannuation Act 1990; or
(c) the Military Superannuation and Benefits
Scheme; or
(d) an exempt public sector superannuation
scheme.
9.04G Sub‑funds
to be treated as funds
A sub‑fund within a regulated superannuation
fund is taken, for the purposes of this Division, to be a regulated
superannuation fund if the sub‑fund satisfies the following conditions:
(a) the sub‑fund has separately
identifiable assets and separately identifiable beneficiaries;
(b) the interest of each beneficiary of the sub‑fund
is determined by reference only to the conditions governing that sub‑fund.
9.04H Operating
standard
For subsection 31 (1) of the Act, a
requirement set out in this Division is a standard applicable to the operation
of regulated superannuation funds.
9.04I Provision
of defined benefit pensions
(1) Subject to subregulation (3), a regulated
superannuation fund that has less than 50 members must not provide a defined
benefit pension.
(2) Subregulation (1) has effect despite anything in the
governing rules of the fund.
(3) A regulated
superannuation fund that has less than 50 members may provide a defined benefit
pension only:
(a) to a person:
(i) who, on 11 May 2004, was a member
of the fund; and
(ii) who,
before 1 January 2006:
(A) retires (within the meaning
of subregulation 6.01 (7)) on or after attaining age 55; or
(B) attains age 65; and
(iii) who, after 11 May 2004 and before
1 January 2006, becomes entitled to be paid a defined benefit pension; and
(b) if the first pension payment is made within 12
months after the day when the person became entitled to the pension.
Division 9.3 Funding and solvency of defined benefit funds
9.05 Application
This Division applies only to defined benefit funds
other than:
(a) funds that are part of one of the following
schemes:
(i) the scheme established by the Superannuation
Act 1976;
(ii) the scheme established under the
provisions of the Superannuation Act 1990;
(iii) the Military Superannuation and
Benefits Scheme; and
(b) funds that are part of an exempt public
sector superannuation scheme; and
(c) funds that have never been used to reduce or
remove the superannuation guarantee charge imposed by section 5 of the Superannuation
Guarantee Charge Act 1992.
9.06 Interpretation
(1) In this Division:
certified minimum contributions, in relation
to a fund, means the minimum contributions certified, in accordance with
subregulation 9.10 (1) or 9.18 (9), in a funding and solvency
certificate.
declared date, in relation to a defined
benefit fund that is technically insolvent, means the date on which an actuary
declares in writing in accordance with paragraph 9.16 (1) (a) that
the fund is technically insolvent.
effective date, in relation to a funding and
solvency certificate, means the date specified in the certificate as the date
on which the certificate takes effect.
expiry date, in relation to a funding and
solvency certificate, means the date specified in the certificate as the date
on which the certificate expires.
minimum benefit index, in relation to a
defined benefit fund, means the index calculated in accordance with regulation
9.15.
notifiable event, in relation to a defined
benefit fund, means:
(a) an amendment of the governing rules of the
fund in a way that affects the level, or method of calculation, of the benefits
of the fund; or
(aa) the receipt by a trustee of the fund of a
written direction from the Regulator under subregulation 9.09 (1A); or
(b) an event identified by an actuary, in
accordance with paragraph 9.10 (1) (c) or 9.18 (9) (b), in
a funding and solvency certificate relating to the fund.
period of technical insolvency, in relation
to a defined benefit fund, means the period starting on the declared date and
ending:
(a) in the case where the responsible actuary is
able to certify the solvency of the fund within 5 years of the declared
date — on the effective date of the funding and solvency certificate in
which the actuary so certifies; and
(b) in any other case — on the date 5 years
after the declared date.
responsible actuary, in relation to a defined
benefit fund, means an actuary who, under subregulation 9.19 (3), has
accepted responsibility for the fund during its period of technical insolvency.
special funding and solvency certificate
means a funding and solvency certificate referred to in subregulation
9.18 (2).
(2) In this Division, a reference to the solvency of a
fund is to be read as a reference to the minimum benefit index of the fund
being certified in accordance with this Division as not less than 1.
(3) In this Division, a reference to the technical
insolvency of the fund is to be read as a reference to the minimum benefit
index of the fund not being able to be certified in accordance with this
Division as not less than 1.
9.07 Prescription
of standards
For the purposes of subsection 31 (1) of the
Act, the standards contained in regulations 9.08, 9.09 and 9.17 are prescribed
as standards applicable to the operation of defined benefit funds to which this
Division applies.
9.08 Funding
standard
(1) In respect of each year of income of a defined
benefit fund to which this Division applies, an employer‑sponsor of the
fund must pay contributions to the fund in accordance with this regulation.
(2) The contributions paid must be not less than the
certified minimum contributions relating to the fund.
(3) Subject to subregulation (4), the contributions must
be paid in accordance with any specification made by the actuary under
paragraph 9.10 (1) (g).
(4) If, under paragraph 9.10 (1) (g), an
actuary has specified the instalments by which the certified minimum
contributions must be paid, each instalment of the contribution must be paid
not later than 28 days after the date indicated by the actuary as the date on
which the instalment must be paid.
(5) If the actuary has not, under paragraph
9.10 (1) (g), specified payment by instalments, the contributions
must be paid not later than 28 July following the end of the year of income in
respect of which the contributions are payable.
9.09 Funding
and solvency certificates — operating standard
(1) The trustee of a defined benefit fund to which this
Division applies must, in accordance with this Division, obtain from an actuary
a funding and solvency certificate in relation to the fund.
(1A) The Regulator may direct the trustee of the fund, in
writing, to obtain from an actuary a new or replacement funding and solvency
certificate if the Regulator considers, on reasonable grounds, that to do so
would be:
(a) in the prudential interests of the fund; and
(b) in the best interests of the members of the
fund.
(1B) The trustee of the fund must comply with a written
direction under subregulation (1A).
(2) The trustee of the fund must, as soon as
practicable, give a copy of a certificate obtained under this regulation to
each employer‑sponsor who has contributed or is contributing to the fund.
9.10 Contents
of funding and solvency certificates
(1) Subject to regulation 9.18 (relating to periods of
technical insolvency), in the funding and solvency certificate required under
regulation 9.09 in relation to a defined benefit fund, an actuary must:
(a) in accordance with regulation 9.11,
9.13 (5) or 9.14 (4), specify the date on which the certificate takes
effect; and
(b) if subregulation 9.11 (4) applies —
make a statement in accordance with that subregulation; and
(c) identify any event relating to the fund
that, if the event occurs during the period when the certificate is in force,
should, in the opinion of the actuary, require the certificate to cease to have
effect and a new certificate to be obtained; and
(d) in accordance with subregulation (2), specify
the date on which the certificate expires; and
(e) certify the solvency of the fund as at the
effective date of the certificate; and
(f) certify the minimum contributions reasonably
expected by the actuary to be required in respect of any member or class of
members to secure the solvency of the fund on the expiry date of the
certificate; and
(g) if the certified minimum contributions
should, in the actuary’s opinion, be paid by instalments — specify the
number and amount of the instalments that must be paid and the frequency with
which they must be paid; and
(h) sign and date the certificate.
(2) The date specified under paragraph (1) (d) as
the date on which the certificate expires must be a date that is:
(a) not less than 12 months; and
(b) not more than 5 years;
after the effective date of the certificate.
9.11 Effective
date of funding and solvency certificates
(1) The first funding and solvency certificate obtained
in respect of a defined benefit fund to which this Division applies must take
effect on:
(a) in the case of a fund in operation on 30
June 1994 in respect of which an actuarial investigation was carried out under
paragraph 17 (1) (a) of the Occupational Superannuation Standards Regulations
on or after 1 July 1991 — whichever of the following dates is
selected by the actuary:
(i) the date of the last such
actuarial investigation prior to 1 July 1994;
(ii) 1 July 1994; and
(b) in the case of a fund in operation on 30 June
1994 to which paragraph (a) does not apply — 1 July 1994; and
(c) in any other case — the date on which
the fund is established.
(2) Subject to subregulations 9.13 (5),
9.14 (4) and 9.18 (8), the effective date of a funding and solvency
certificate may be a date earlier than the date on which the actuary signs the
certificate but must not be more than 12 months earlier than that date, except
in the case of a first funding and solvency certificate to which subregulation
(3) applies.
(3) If a first funding and solvency certificate takes
effect in accordance with subparagraph (1) (a) (i) and the actuary signs the
certificate not later than 30 June 1995, the effective date of the certificate
may be more than 12 months earlier than the date on which the actuary signs the
certificate.
(4) If the effective date of a funding and solvency
certificate is earlier than the date on which the actuary signs the
certificate, the actuary must only sign the certificate if the actuary is not
aware, and makes a statement in the certificate that he or she is not aware, of
any occurrence between the effective date and the date of signing that would
affect the contents of the certificate.
9.12 Period
of effect of funding and solvency certificates
(1) Subject to regulation 9.18, a funding and solvency
certificate takes effect from and including the effective date to and including
whichever of the following first occurs:
(a) the expiry date; or
(b) the date on which the certificate ceases to
have effect under subregulation (2).
(2) A funding and solvency certificate relating to a
defined benefit fund ceases to have effect if:
(a) amounts from the fund are released to an
employer‑sponsor of the fund under section 117 of the Act; or
(b) another funding and solvency certificate
takes effect in respect of the fund; or
(c) a notifiable event occurs in relation to the
fund; or
(d) an employer‑sponsor of the fund fails
to pay the contributions relating to the fund in accordance with subregulation
9.08; or
(e) subparagraphs (2) (a), (b), (c) and (d)
do not apply and the actuary, in the performance of his or her actuarial
functions under the Act or these regulations, forms the opinion that the
certificate is no longer appropriate and withdraws the certificate by giving
written notice of withdrawal to the trustee.
9.13 Effect
of notifiable events on funding and solvency certificates
(1) In this regulation, lapsed certificate
means a funding and solvency certificate that, under subregulation (2), has
ceased to have effect because of the occurrence of a notifiable event.
(2) If a notifiable event occurs in relation to a
defined benefit fund to which this Division applies:
(a) the existing funding and solvency
certificate in relation to the fund ceases to have effect at the end of the
date on which the notifiable event occurs; and
(b) the trustee of the fund must obtain a new
funding and solvency certificate in accordance with this regulation.
(3) The new funding and solvency certificate must be
obtained not later than 3 months after the date on which the notifiable event
occurs.
(4) The new funding and solvency certificate must be of
a kind specified by an actuary at the request of the trustee, being whichever
of the following kinds is considered by the actuary to be most appropriate,
taking into account the nature of the notifiable event and its effect on the
fund:
(a) a new funding and solvency certificate
having the same contents as the lapsed certificate;
(b) a new funding and solvency certificate
containing such modifications of the lapsed certificate as are specified by the
actuary;
(c) a new funding and solvency certificate
unrelated to the lapsed certificate and relying upon new calculations to be
made by the actuary.
(5) The date on which a new funding and solvency certificate
obtained under subregulation (2), because of the occurrence of a notifiable
event, takes effect must be the date immediately following the date on which
the notifiable event occurs.
(6) The expiry date of the new funding and solvency
certificate may be different from the expiry date of the lapsed certificate.
9.14 Further
funding and solvency certificates to be obtained
(1) In this regulation:
effective funding and solvency certificate
means a funding and solvency certificate that has taken effect and has not
expired or otherwise ceased to have effect.
term, in relation to a funding and solvency
certificate, means the period starting on the effective date of the certificate
and ending on the expiry date of the certificate.
(2) Subject to regulations 9.13 and 9.18 and
subregulation (3), the trustee of a defined benefit fund that has an effective
funding and solvency certificate relating to the fund must obtain a further
funding and solvency certificate relating to the fund that is signed:
(a) in the case of a certificate having a term
of 4 years or less — on or before the date on which 75% of the term
expires; and
(b) in the case of a certificate having a term of
more than 4 years — not less than 12 months before the end of the
term.
(3) If, under paragraphs 9.12 (2) (a), (d) or
(e), a funding and solvency certificate in relation to a fund ceases to have
effect:
(a) before the expiry date specified in the
certificate; and
(b) before a further funding and solvency
certificate has been obtained under subregulation (2);
the trustee of the fund must obtain a further funding and solvency
certificate not later than 3 months after the date on which the first‑mentioned
funding and solvency certificate ceased to have effect.
(4) The date on which a further funding and solvency
certificate referred to in subregulation (3) takes effect must be the date
immediately following the date on which the previous funding and solvency
certificate ceased to have effect.
9.15 Minimum
benefit index
(1) The minimum benefit index in respect of a defined
benefit fund is the index calculated in accordance with the following formula:
(2) In this regulation:
adjusted minimum benefit index, in relation
to a defined benefit fund, means:
(a) if the index calculated as at the initial
date in accordance with the following formula:
is less than 1 — that index;
and
(b) in any other case — an index of 1.
BEF, in relation to a defined benefit fund,
means the value of the benefit entitlements of former members of the fund.
benefit entitlements of former members, in
relation to a defined benefit fund, means the beneficial interests in the fund
(including any amount that would be payable out of those interests to the
spouse, or former spouse, of the former member under a payment split) of
beneficiaries (including pension beneficiaries and deferred beneficiaries) who
are not standard employer‑sponsored members of the fund.
FMRB means the funded minimum requisite
benefit.
funded minimum requisite benefit, in relation
to a defined benefit fund, means the amount that is the sum of:
(a) the value of the pre‑initial date
component of the MRB multiplied by the adjusted minimum benefit index; and
(b) the value of the post‑initial date component
of the MRB.
initial date means whichever is the earlier
of the following dates:
(a) the date on which the first funding and
solvency certificate in relation to the defined benefit fund takes effect in
accordance with subregulation 9.11 (1);
(b) 1 July 1994.
MRB means the total amount of the minimum
requisite benefits (including any amount that would be payable out of those
benefits to the member’s spouse or former spouse under a payment split) of all
current members of the fund.
net realisable value of the assets, in
relation to a fund, means the amount calculated by deducting the estimated cost
of disposing of the assets of the fund from the market value of those assets.
NRV, in relation to a defined benefit fund,
means the net realisable value of the assets of the fund.
9.16 Non‑compliance
with solvency requirement — technical insolvency
(1) If an actuary, in the course of carrying out
actuarial functions in relation to a defined benefit fund, other than a fund
that is technically insolvent, discovers that he or she is unable to certify
the solvency of the fund as required under these regulations, the actuary must,
as soon as practicable:
(a) declare, in writing signed by the actuary,
that the fund is technically insolvent on the date on which the declaration is
made; and
(b) deliver to the trustee a copy of the
declaration of technical insolvency.
(2) A defined benefit fund is, for the purposes of these
regulations, taken to be technically insolvent on and from the declared date.
9.17 Technical
insolvency — operating standard
The trustee of a defined benefit fund that is taken
to be technically insolvent for the purposes of these regulations must either:
(a) initiate a program in accordance with this
Division that is designed by an actuary to return the fund to a position that
would enable the actuary to certify the solvency of the fund in a funding and
solvency certificate in accordance with regulation 9.10 not later than 5 years
after the date on which the technical insolvency commenced; or
(b) initiate winding‑up proceedings in
accordance with Division 9.4.
9.18 Technical
insolvency program — special funding and solvency certificate
(1) In this regulation, concluding date,
in relation to a funding and solvency certificate of a defined benefit fund,
means whichever of the following first occurs:
(a) the expiry date; or
(b) the date on which the certificate ceases to
have effect under subregulation 9.12 (2).
(2) If a defined benefit fund is technically insolvent,
the funding and solvency certificate that the trustee is required to obtain
under regulation 9.09 must be a special funding and solvency certificate that
complies with this regulation.
(3) A special funding and solvency certificate takes
effect from and including the effective date to and including the concluding
date.
(4) A special funding and solvency certificate (the first
special funding and solvency certificate) must be obtained as soon as
practicable after the date on which a defined benefit fund becomes technically
insolvent and not later than 3 months after that date.
(5) The date on which the first special funding and
solvency certificate obtained under subregulation (2) takes effect must be a
date that is not more than 9 months earlier than the declared date.
(6) At least one further special funding and solvency
certificate must be obtained in each subsequent period of 12 months following
the concluding date of the first special funding and solvency certificate until
the end of the period of technical insolvency.
(7) Each further special funding and solvency
certificate required under subregulation (6) must be obtained not later than 3
months after the concluding date of the previous special funding and solvency
certificate.
(8) The date on which a further special funding and
solvency certificate required under subregulation (6) takes effect must be the
date immediately following the concluding date of the previous special funding
and solvency certificate.
(9) In a special funding and solvency certificate
relating to a defined benefit fund, an actuary must:
(a) specify the date on which the certificate
takes effect, in accordance with subregulation (5) and (8); and
(b) identify any event relating to the fund that,
if the event occurs during the period when the certificate is in force, should,
in the opinion of the actuary, require the certificate to cease to have effect
and a new certificate to be obtained; and
(c) specify the date on which the certificate
expires, in accordance with subregulation (10); and
(d) certify the minimum contributions reasonably
expected by the actuary to be required to secure the solvency of the fund at
the end of the period of technical insolvency; and
(e) certify the improvement (if any) in the
level of the minimum benefit index from its level at the effective date of the
immediately preceding funding and solvency certificate relating to the fund.
(10) The date specified under paragraph (9) (c) as the
date on which the certificate expires must be a date that is 12 months after
the effective date of the certificate.
9.19 Technical
insolvency programs — procedure
(1) This regulation sets out the procedure to be
followed in relation to a defined benefit fund to which this Division applies
during any period of technical insolvency of the fund.
(2) An employer‑sponsor of the fund must continue
to pay contributions that are not less than the certified minimum contributions
as required under regulation 9.08.
(3) The trustee of the fund must secure the services of
an actuary for the fund who accepts responsibility for the actuarial management
of the fund during the period of technical insolvency, including responsibility
for the provision of special funding and solvency certificates and any
approvals required under subregulation (4).
(4) The trustee must not make any payment from the fund
unless, in respect of a payment:
(a) the responsible actuary gives written
approval for that particular payment to be made; or
(b) the amount of the payment is determined in
accordance with a scheme for payment approved in writing by the responsible
actuary.
(5) If, during a period of technical insolvency of a
fund, the responsible actuary for the fund is no longer willing or able to
accept responsibility for the fund, the actuary must, if practicable, inform the
Regulator and the trustee that this is the case, giving the actuary’s reasons.
(6) As soon as a trustee of a fund becomes aware that
the responsible actuary for the fund is no longer willing or able to accept
responsibility for the fund, the trustee must secure the services of another
responsible actuary in accordance with subregulation (3) and must inform the
Regulator of the change in the fund’s responsible actuary.
Division 9.4 Winding‑up of defined benefit funds
9.20 Application
This Division applies only to defined benefit funds
other than:
(a) funds that are part of one of the following
schemes:
(i) the scheme established by the Superannuation
Act 1976;
(ii) the scheme established under the
provisions of the Superannuation Act 1990;
(iii) the Military Superannuation and
Benefits Scheme; and
(b) funds that are part of an exempt public
sector superannuation scheme; and
(c) funds that have never been used to reduce or
remove the superannuation guarantee charge imposed by section 5 of the Superannuation
Guarantee Charge Act 1992.
9.21 Interpretation
(1) In this Division:
benefit entitlements of former members has
the same meaning as in subregulation 9.15 (2).
funded minimum requisite benefit has the same
meaning as in subregulation 9.15 (2).
minimum benefit index at the winding‑up date,
in relation to a defined benefit fund, means an index calculated in accordance
with regulation 9.15 except that the net realisable value of the assets is, for
the purposes of the calculation, taken to be the net realisable value of the
assets at the winding‑up date as defined by this Division.
net realisable value of the assets at the winding‑up
date, in relation to a defined benefit fund, means the amount
calculated by deducting the sum of:
(a) the actual cost of disposing of the assets
of the fund; and
(b) the administration, and other, costs
associated with the winding‑up proceedings being carried out in relation
to the fund in accordance with this Division;
from the amount received on realisation of the assets of the fund.
period of technical insolvency has the same
meaning as in Division 9.3.
responsible actuary, in relation to a defined
benefit fund, means an actuary who, under subregulation 9.19 (3), accepted
responsibility for the fund during its period of technical insolvency.
winding‑up date, in relation to a
defined benefit fund, means the date at which the trustee determines the
allocations to be made, under the winding‑up proceedings, to members of
the fund in respect of their benefit entitlements.
(2) In this Division, a reference to the solvency of a
fund is to be read as a reference to the fund’s minimum benefit index, as that
term is defined in Division 9.3, being certified in accordance with that
Division as not less than 1.
(3) In this Division, a reference to the technical
insolvency of the fund is to be read as a reference to the fund’s minimum
benefit index, as that term is defined in Division 9.3, not being able to be
certified in accordance with that Division as not less than 1.
9.22 Prescription
of standards
For the purposes of subsection 31 (1) of the Act,
the standards contained in regulations 9.23, 9.24 and 9.25 are prescribed as
standards applicable to the operation of defined benefit funds to which this
Division applies.
9.23 Winding‑up
of defined benefit funds
(1) Subject to subregulation (4), the trustee of a
defined benefit fund that is technically insolvent must initiate winding‑up
proceedings in accordance with this Division if:
(a) the fund fails to comply with regulations
9.17, 9.18 or 9.19 during the period of technical insolvency; or
(b) the actuary is unable to certify the solvency
of the fund at the end of that period;
and regulation 9.24 does not apply.
(2) Winding‑up proceedings initiated under
subregulation (1) must be carried out in accordance with this Division.
(3) Subject to subregulation (4), if a trustee of a
defined benefit fund to which this Division applies initiates winding‑up
proceedings in relation to the fund otherwise than under subregulation (1), the
winding‑up proceedings must be carried out in accordance with this
Division.
(4) This regulation does not apply to a defined benefit
fund in respect of which the Regulator formulates a scheme for the winding‑up
of the fund.
9.24 Alternative
programs approved by the Regulator
(1) If, as an alternative to commencing winding‑up
proceedings, the responsible actuary of a defined benefit fund recommends in
writing to the trustee of the fund a specified course of action, the trustee,
if he or she wishes to accept the actuary’s recommendations, must, within 21
days after receiving the recommendations, forward a copy of the recommendations
to the Regulator, together with a request that the Regulator approve the
recommendations.
(2) If the Regulator approves the actuary’s
recommendations, and notifies the trustee in writing of the approval, the
trustee must follow the specified course of action as recommended.
9.25 Winding‑up
proceedings — priorities
(1) If, under regulation
9.23, winding‑up proceedings in relation to a defined benefit fund are to
be carried out in accordance with this Division, priority must be given to the
liabilities of the fund in accordance with this regulation.
(2) The first charge on the assets of the fund must be
the liability in respect of the administration and other costs associated with
the winding‑up proceedings.
(3) In determining the priorities to be given to the
remaining liabilities of the fund, the trustee must ensure compliance with
subregulations (4) and (5).
(4) If the fund’s minimum benefit index at the winding‑up
date is equal to or greater than 1, the benefit entitlement allocated to each
individual member of the fund at the winding‑up date must be an amount
that is not less than the sum of such part of:
(a) the funded minimum requisite benefit; and
(b) the benefit entitlements of former members;
as is attributable to that individual member.
(5) If the fund’s minimum benefit index at the winding‑up
date is less than 1, the benefit entitlement allocated to each individual
member of the fund at the winding‑up date must not be either:
(a) greater than the amount referred to in
subregulation (4) in respect of that individual member; or
(b) less than an amount calculated by multiplying
the amount referred to in subregulation (4) in respect of that individual
member by the fund’s minimum benefit index at the winding‑up date.
Division 9.5 Actuarial standards relating to defined benefit funds
9.26 Application
This Division applies only to defined benefit
funds.
9.27 Interpretation
In this Division:
accrued benefits, in relation to a member of
a defined benefit fund, means the benefits to which the member has an absolute
or potential entitlement at the valuation date on account of the length of time
the member has been a member of the fund at that date (including any amount
that would be payable out of those benefits to the member’s spouse or former
spouse under a payment split).
fully funded, in relation to a fund, means
funded in advance in accordance with actuarial advice at a level that is
reasonably expected by the actuary to be adequate to provide for present and
prospective liabilities in respect of benefits relating to the fund.
new fund means:
(a) any defined benefit fund established on or
after 1 July 1994; or
(b) any fund converted on or after 1 July 1994 to
a defined benefit fund;
in respect of which no previous actuarial report has been made.
valuation date, in relation to a defined
benefit fund, means the date as at which an investigation required under
regulation 9.29 was carried out in relation to the fund.
9.28 Prescription
of standards
For the purposes of subsection 31 (1) of the Act,
the standards contained in regulations 9.29 and 9.30 are prescribed as
standards applicable to the operation of defined benefit funds.
9.29 Actuarial
investigation standard
(1) A trustee of a defined benefit fund must require an
actuarial investigation to be made in relation to the fund:
(a) in the case of a defined benefit fund in
operation on 30 June 1994 — as at a date not later than 3 years
after:
(i) the date as at which the last
actuarial investigation was made; or
(ii) if no actuarial investigation was
made — the date of establishment of the fund, or conversion of the fund to
a defined benefit fund; and
(b) in the case of a new fund — as at the
date of establishment or conversion of the fund;
and, in all cases, after the first actuarial investigation has been
made in relation to a fund under paragraph (a) or (b), further regular
actuarial investigations must be made as at a date not later than 3 years after
the date as at which the last actuarial investigation was made.
(2) The Regulator may direct the trustee of the fund,
in writing, to require an actuarial investigation to be made in relation to the
fund if the Regulator considers, on reasonable grounds, that to do so would be:
(a) in the prudential interests of the fund; and
(b) in the best interests of the members or
beneficiaries of the fund.
(3) The trustee of the fund must comply with a written
direction under subregulation (2).
9.30 Actuarial
reporting standard
(1) A trustee of a defined benefit fund must obtain an
actuarial report in accordance with this regulation in relation to each
investigation required to be made under regulation 9.29 in relation to the
fund.
(2) The actuarial report must be obtained within the
period of 12 months commencing on the date immediately following the
valuation date in relation to the fund.
(3) The actuarial report
must contain:
(a) in relation to a private sector fund or a
fully funded public sector superannuation scheme — the matters specified
in regulation 9.31; and
(b) in relation to a public sector superannuation
scheme that is not fully funded — the matters specified in regulation
9.32.
9.31 Contents
of actuarial report — private sector funds and fully funded public sector
superannuation schemes
(1) Subject to regulation 9.33, an actuarial report
required under regulation 9.30 that relates to a private sector fund or a fully
funded public sector superannuation scheme must contain, in addition to any
other matter:
(a) a statement of the value of the assets of
the fund at the valuation date; and
(b) a statement of the actuary’s opinion on
whether, at the valuation date, the value of the assets of the fund is adequate
to meet the value of the liabilities of the fund in respect of accrued benefits
in the fund of members of the fund; and
(c) a statement recommending, in respect of the
3‑year period immediately following the valuation date, the rate at
which, or the range of rates within which, the actuary considers employer
contributions should be made or, where the actuary considers employer
contributions should be made at different rates or within different ranges in
respect of 2 or more periods within the 3‑year period, such different
rates or ranges of rates; and
(d) a statement, made in accordance with
subregulations (3) and (4) regarding the financial position of the fund; and
(e) if the fund has been used to reduce or
remove the superannuation guarantee charge imposed by section 5 of the Superannuation
Guarantee Charge Act 1992:
(i) a statement that all funding and
solvency certificates required under this Part during the period of the
investigation to which the report relates were obtained; and
(ii) a statement of the actuary’s
opinion regarding the likelihood of an actuary being able to certify the
solvency of the fund in any funding and solvency certificate that may be
required under these regulations during the 3‑year period immediately
following the valuation date; and
(f) if, under section 342 of the Act, a pre‑1
July 1988 funding credit has been granted or, under Part 12 of these
regulations, has been obtained by transfer and a prescribed event referred to
in paragraph 342 (4) (a) of the Act has occurred — a statement
that the prescribed event has occurred.
(2) In forming an opinion referred to in paragraph
(1) (b), an actuary must consider both:
(a) the position of the fund at the valuation
date; and
(b) the likely future position of the fund,
during the 3 years immediately following the valuation date, based on the
reasonable expectations of the actuary.
(3) In making a statement regarding financial position
under paragraph (1) (d), the actuary must indicate whether the financial
position of the fund is treated as unsatisfactory under regulation 9.04 and
whether the fund may, in the actuary’s opinion, be about to become
unsatisfactory, taking into consideration in relation to the fund the matters
referred to in regulation 9.03.
(4) In a statement made under paragraph (1) (d), if
an actuary considers that the stated financial position of the fund is
dependant upon certain actions being taken or certain schemes being
implemented, the actuary must indicate this and must include in the statement a
detailed description of those actions or schemes.
9.32 Contents
of actuarial report — public sector superannuation schemes that are not
fully funded
Subject to regulation 9.33, an actuarial report
required under regulation 9.30 that relates to a public sector superannuation
scheme that is not fully funded must contain, in addition to any other matter:
(a) a statement of the value of the assets of
the fund at the valuation date; and
(b) if the actuary considers it appropriate,
taking into account the proportion of the liabilities of the fund that are
being funded — a statement recommending, in respect of the 3‑year
period immediately following the valuation date, the rate at which, or the
range of rates within which, the actuary considers employer contributions
should be made or, where the actuary considers employer contributions should be
made at different rates, or within different ranges, in respect of 2 or more
periods within the 3‑year period, such different rates or ranges or
rates; and
(c) a statement
regarding the adequacy of the funding of the liabilities of the fund, having
regard to any guarantee given by the Commonwealth or by a State or Territory
regarding the payment of benefits to members and taking into account any
appropriations in respect of the fund; and
(d) if, under section 342 of the Act, a pre‑1
July 1988 funding credit has been granted or, under Part 12 of these
Regulations, has been obtained by transfer and a prescribed event referred to
in paragraph 342 (4) (a) of the Act has occurred — a statement
that the prescribed event has occurred.
9.33 Content
of actuarial report — newly established or converted funds
If an actuarial report required under regulation
9.30 relates to a new fund, the report;
(a) must contain:
(i) a statement recommending, in
respect of the 3‑year period immediately following the valuation date,
the rate at which, or the range of rates within which, the actuary considers
employer contributions should be made or, where the actuary considers employer
contributions should be made at different rates or within different ranges in
respect of 2 or more periods within the 3‑year period, such different
rates or ranges of rates; and
(ii) a statement of the actuary’s
opinion regarding the likelihood of an actuary being able to certify the
solvency of the fund in any funding and solvency certificate that may be
required under these regulations during the 3‑year period immediately
following the valuation date; but
(b) need not contain any of the other matters set
out in regulation 9.31 or 9.32 (whichever is applicable).
Division 9.6 Solvency of accumulation funds
9.34 Application
This Division
applies only to accumulation funds other than:
(a) funds that are part of an exempt public
sector superannuation scheme; and
(b) funds that have never been used to reduce or
remove the superannuation guarantee charge imposed by section 5 of the Superannuation
Guarantee Charge Act 1992.
9.35 Interpretation
(1) In this Division:
fund’s actuary, in relation to an
accumulation fund, means an actuary whose services are secured by the trustee
of the fund under subregulation 9.39 (2).
mandated employer‑financed benefits has
the same meaning as in Part 5.
member financed‑benefits has the same
meaning as in Part 5.
minimum guaranteed benefit, in relation to a
member of an accumulation fund, means an amount that is the sum of:
(a) the member‑financed benefits of the
member; and
(b) the mandated employer‑financed benefits
of the member; and
(c) any minimum benefits of the member under
regulation 5.06B, that are not included in paragraph (a) or (b).
net realisable value,
in relation to the assets of an accumulation fund, means the amount calculated
by deducting the estimated cost of disposing of the assets of the fund from the
market value of those assets.
period of technical insolvency, in relation
to an accumulation fund, means the period starting on the first day of the year
of income in which the fund becomes technically insolvent or in which the
trustee makes an election under subregulation 9.38 (2) and ending on:
(a) in the case
where the fund is solvent at the beginning of a year of income that is earlier
than the sixth year of income following the year of income in which the period
starts — the first day of that first‑mentioned year of income;
(b) in any other case — the first day of
that sixth year of income.
(2) In this Division, a
reference to an accumulation fund being solvent is to be read as a reference to
the net realisable value of the assets of the fund being equal to or greater
than the minimum guaranteed benefits of members of the fund.
(3) In this Division a reference to an accumulation fund
being technically insolvent is to be read as a reference to the net realisable
value of the assets of the fund being less than the minimum guaranteed benefits
of members of the fund.
9.36 Prescription
of standards — accumulation funds
For the purposes of subsection 31 (1) of the
Act, the standards contained in regulations 9.37, 9.38 and 9.39 are prescribed
as standards applicable to the operation of accumulation funds to which this
Division applies.
9.37 Accumulation
funds solvency standard
(1) Subject to subregulation (2), in a year of income
the trustee of an accumulation fund that is solvent at the beginning of the
year of income must not add such an amount to the minimum guaranteed benefits
of members of the fund, in respect of the earnings of the fund, that would
result in the fund being technically insolvent at the end of the year of
income.
(2) In a year of income, the trustee of an accumulation
fund to which subregulation (1) applies may add an amount referred to in
subregulation (1) if the amount is added in accordance with a program referred
to in subregulation 9.38 (2).
(3) In a year of income, the trustee of an accumulation
fund that is technically insolvent at the beginning of the year of income must
only add amounts to the minimum guaranteed benefits of members of the fund in
accordance with a program referred to in subregulation 9.38 (1).
9.38 Technical
insolvency of accumulation funds — operating standard
(1) The trustee of an accumulation fund that is
technically insolvent must either:
(a) initiate a program in accordance with this
Division that is designed by an actuary to ensure that the fund is in a solvent
position not later than at the end of the fifth year of income following the
year of income in which the fund became technically insolvent; or
(b) initiate winding‑up proceedings.
(2) The trustee of an accumulation fund to which
subregulation (1) does not apply may elect to have the fund comply with a
program comparable with a program referred to in paragraph (1) (a), except that
the program is designed to ensure that the fund is in a solvent position not
later than at the end of the fifth year of income following the year of income
in which the trustee made the election.
9.39 Technical
insolvency program for accumulation funds — procedure
(1) This regulation sets out the procedure to be
followed, in relation to an accumulation fund to which this Division applies,
during any period of technical insolvency.
(2) The trustee of the fund must secure the services of
an actuary for the fund, who must, as soon as practicable, design a program of
the kind referred to in paragraph 9.38 (1) (a) or subregulation 9.38 (2)
(whichever is applicable) and inform the trustee of the requirements of that
program.
(3) The trustee of the fund must not add an amount to
the minimum guaranteed benefits of members of the fund during any period of
technical insolvency unless:
(a) the addition is approved in writing by the
fund’s actuary; or
(b) the amount is added in accordance with a
scheme approved in writing by the fund’s actuary for the adding of such
amounts.
(4) During any period of technical insolvency of the
fund, the trustee of the fund must not make any payment from the fund unless:
(a) the fund’s actuary gives written approval
for that particular payment to be made; or
(b) the amount of the payment is determined in
accordance with a scheme for payment approved in writing by the fund’s actuary.
Division 9.7 Winding‑up of accumulation funds
9.40 Application
This Division applies only to accumulation funds to
which Division 9.6 applies.
9.41 Interpretation
(1) In this Division:
fund’s actuary means an actuary whose
services are secured under subregulation 9.39 (2).
minimum guaranteed benefit, in relation to a
member of an accumulation fund, has the same meaning as in Division 9.6.
net realisable value of the assets at the winding‑up
date, in relation to an accumulation fund, means the amount calculated
by deducting from the amount received on realisation of those assets the sum
of:
(a) the actual cost of disposing of the assets
of the fund; and
(b) the administration and other costs associated
with winding‑up proceedings in respect of the fund.
period of technical insolvency, in relation
to an accumulation fund, has the same meaning as in Division 9.6.
winding‑up date, in relation to an
accumulation fund, means the date at which the trustee determines the
allocations to be made, under the winding‑up proceedings, to members of
the fund in respect of their benefit entitlements.
(2) In this Division, a reference to an accumulation
fund being solvent at the winding‑up date is to be read as a reference to
the net realisable value of the assets at the winding‑up date being equal
to or greater than the minimum guaranteed benefits of members of the fund at
that date.
(3) In this Division, a reference to an accumulation
fund being technically insolvent at the winding‑up date is to be read as
a reference to the net realisable value of the assets at the winding‑up
date being less than the minimum guaranteed benefits of members of the fund at
that date.
9.42 Prescription
of standards — winding‑up of accumulation funds
For the purposes of subsection 31 (1) of the
Act, the standards contained in regulations 9.43, 9.44 and 9.45 are prescribed
as standards applicable to the operation of accumulation funds which this
Division applies.
9.43 Winding‑up
of accumulation funds
(1) Subject to subregulation (4), the trustee of an
accumulation fund to which this Division applies that is in a period of
technical insolvency must initiate winding‑up proceedings in accordance
with this Division if;
(a) the fund fails to comply with regulation
9.38 or 9.39 during a period of technical insolvency; or
(b) the fund is not solvent within the meaning of
that term in subregulation 9.35 (2) on the date on which that period ends;
and regulation 9.44 does not apply.
(2) Winding‑up proceedings initiated under
subregulation (1) must be carried out in accordance with this Division.
(3) Subject to subregulation (4), if a trustee of an
accumulation fund to which this Division applies initiates winding‑up
proceedings in relation to the fund otherwise than under subregulation (1), the
winding‑up proceedings must be carried out in accordance with this
Division.
(4) This regulation does not apply to an accumulation
fund in respect of which the Regulator formulates a scheme for the winding‑up
of the fund.
9.44 Alternative
programs approved by the Regulator for accumulation funds
(1) If, as an alternative to commencing winding‑up
proceedings, an accumulation fund’s actuary recommends in writing to the
trustee of the fund a specified course of action, the trustee,
if he or she wishes to accept the recommendations of the
fund’s actuary, must, within 21 days after receiving the recommendations,
forward a copy of the recommendations to the Regulator, together with a request
that the Regulator approve the recommendations.
(2) If the Regulator approves the recommendations of the
fund’s actuary and notifies the trustee in writing of the approval, the trustee
must follow the specified course of action as recommended.
9.45 Accumulation
fund winding‑up proceedings — priorities
(1) If a trustee of an accumulation fund initiates
winding‑up proceedings in relation to the fund, priority must be given to
the liabilities of the fund in accordance with this regulation.
(2) The first charge on the assets of the fund must be
the liability in respect of the administration and other costs associated with
the winding‑up proceedings.
(3) In determining the priorities to be given to the
remaining liabilities of the fund, the trustee must ensure compliance with
subregulations (4) and (5).
(4) If the fund is solvent at the winding‑up date,
the amount allocated to each individual member of the fund at the winding‑up
date must not be less than the minimum guaranteed benefit of the member.
(5) If the fund is
technically insolvent at the winding‑up date, an amount equal to the net
realisable value of the assets at the winding‑up date must be apportioned
among all the members of the fund at that date so that the proportion of that
amount that is apportioned to an individual member bears the same relation to
the whole amount as the minimum guaranteed benefit of that member bears to the
total of minimum guaranteed benefits in respect of all the members of the fund
at the winding‑up date.
Part 10 Eligible rollover funds
Division 10.1 Introductory
10.01 Definition
of eligible rollover fund (Act, s 242)
(1) For the purposes of the definition of eligible
rollover fund in section 242 of the Act, a fund is an eligible rollover
fund if:
(a) it has the following characteristics:
(i) the fund is a regulated
superannuation fund or an approved deposit fund;
(ii) the trustee of the fund has given
to APRA a notice in the approved form stating that it is an eligible rollover
fund;
(iii) the fund has not ceased to be an
eligible rollover fund; or
(b) the fund:
(i) was an eligible rollover fund
immediately before 1 July 1995; and
(ii) has not ceased to be an eligible
rollover fund.
(2) A fund ceases to be an eligible rollover fund if the
trustee of the fund gives notice of wishing to do so to APRA in the approved
form.
(3) A notice under subparagraph (1) (a) (ii) or
subregulation (2) has effect at the time when APRA acknowledges having received
it.
Division 10.2 Prescribed matters
10.02 Interpretation
Expressions used in this Division that are defined
for the purposes of Part 24 of the Act have the same meaning in this Division
as in that Part.
10.03 Payment
of benefit to eligible rollover fund
(1) For the purposes of paragraph 243 (1) (b) of
the Act, 1 July 1995 is the date from which section 243 of the Act applies to a
person.
(2) For paragraph 243 (1) (c) of the Act, the
condition is that the beneficiary is not a non‑member spouse whose
entitlement under a payment split is to be dealt with under regulation 7A.16.
(3) For paragraph 243 (3) (b) of the Act, the
amount of the consideration for the issue of a superannuation interest is the
amount of the beneficiary’s withdrawal benefit in the transferor fund (not
including any amount that would be payable to the member’s spouse or former
spouse under a payment split).
Note Section 243 of the Act sets out the
circumstances in which the trustee of a fund may apply to an eligible rollover
fund, on behalf of a beneficiary of the fund, for the issue of a superannuation
interest in the eligible rollover fund to the beneficiary.
Division 10.3 Additional operating standards applicable to eligible
rollover funds
10.06 Operating
standards — eligible rollover funds
(1) For subsections 31 (1) and 32 (1) of the Act, and
subject to regulation 10.07, the standard stated in subregulation (2) is a
standard applicable (in addition to other standards applicable under these
Regulations) to the operation of an eligible rollover fund.
(2) The trustee of an eligible rollover fund must accept
payment of:
(a) benefits (other than pension benefits) paid
from:
(i) a superannuation fund (other than
an eligible rollover fund); or
(ii) an approved deposit fund (other
than an eligible rollover fund); or
(iii) an RSA; and
(b) shortfall components; and
(c) amounts paid from the Superannuation Holding Accounts Special Account.
(3) The trustee of an
eligible rollover fund must treat:
(a) every member of the fund as a protected
member at all times; and
(b) the whole of the benefits of every member as
minimum benefits (within the meaning of Part 5) at all times.
10.07 Operating
standard — restriction on acceptance of rollovers [see Note 2]
(1) For paragraphs 31 (2) (d) and
32 (2) (a) of the Act, the standard stated in subregulation (2) is
applicable to a registrable superannuation entity that is an eligible rollover
fund.
(2) A trustee of a registrable superannuation entity
that is an eligible rollover fund must not, unless the registrable
superannuation entity is registered under Part 2B of the Act, accept payment
of:
(a) benefits; or
(b) shortfall components; or
(c) amounts paid from the Superannuation Holding Accounts Special Account.
Part 11 Information to be given to the Regulator and related matters
11.01 Definition
In this Part:
contact person means a named individual, or a
person holding a designated office or position, who is available to receive and
deal with inquiries from the Regulator.
11.02A Service
of contravention notice (Act s 252B)
(1) For subsection
252B (1) of the Act, a contravention notice may be served on the trustee
of a fund by:
(a) delivering it personally to the trustee; or
(b) leaving it at the trustee’s address for
service; or
(c) sending it by facsimile transmission:
(i) to the trustee; or
(ii) to another person who would, in
the ordinary course of events, give the notice to the trustee; or
(d) sending it by prepaid letter post, addressed
to the trustee at the trustee’s address for service.
(2) For paragraphs (1) (b) and (d), a trustee’s
address for service is:
(a) if the trustee told APRA or the Commissioner
of Taxation of the fund’s registered address or address for service — that
address; or
(b) in any other case — any address that
whichever of APRA or the Commissioner of Taxation is serving the notice
reasonably believes is the trustee’s address.
(3) In the absence of proof to the contrary, a
contravention notice served on a trustee in accordance with subregulation (1)
is taken to have been served:
(a) in the case of service in accordance with
paragraph (1) (a), (b), or (c) — when the notice or document is
delivered, left or transmitted; and
(b) in the case of service in accordance with
paragraph (1) (d) — when the notice or document would, in the
ordinary course of post, have arrived at the place to which it was addressed.
11.03 Period
for giving information to the Regulator, Act, s 254 (1)
For subsection 254 (1) of the Act, the
prescribed period is 7 days.
11.04 Prescribed
information (subsection 254 (1)) — regulated superannuation funds
For the purposes of subsection 254 (1) of the
Act, the prescribed information in relation to the trustee of a regulated
superannuation fund is:
(a) the following general information:
(i) the name of the fund; and
(ii) the postal address of the fund;
and
(iii) the registered address of, or an
address for service of notices on, the fund; and
(iv) a contact person, and contact
telephone and facsimile numbers; and
(b) the following trustee information:
(i) if the trustee is a corporate
trustee — the name, registered address and telephone number of the
trustee, and the name of each director of the trustee; or
(ii) if the trustee, or each of the
trustees, is an individual — the name of the trustee or of each trustee,
as the case requires; and
(c) the following fund information:
(i) the date of establishment of the fund;
and
(ii) a
statement as to whether:
(A) the trustee of the fund
is a constitutional corporation pursuant to a requirement contained in the
governing rules; or
(B) the governing rules of
the fund provide that the sole or primary purpose of the fund is the provision
of old‑age pensions; and
(iii) a statement as to whether the
fund is any (and if so, which) of the following:
(A) a self managed
superannuation fund; or
(B) a public offer
superannuation fund; or
(C) a public sector
superannuation fund; or
(D) a public sector
superannuation scheme;
(iv) if the fund is a self managed
superannuation fund — a statement as to whether, in the trustee’s opinion,
the fund is likely to be a self managed superannuation fund at the end of
12 months after the date of lodgment of the notice.
11.05 Prescribed
information (subsection 254 (1)) — approved deposit funds
For the purposes of subsection 254 (1) of the
Act, the prescribed information in relation to the trustee of an approved
deposit fund is:
(a) the following general information:
(i) the name of the fund; and
(ii) the postal address of the fund;
and
(iii) the registered address of, or an
address for service of notices on, the fund; and
(iv) a contact person, and contact
telephone and facsimile numbers; and
(b) the following trustee information:
(i) the name of the trustee, its
registered address and telephone number; and
(ii) the name of each director of the
trustee; and
(c) the following
fund information:
(i) the date of establishment of the
fund; and
(ii) a statement as to whether the fund
is an excluded approved deposit fund.
11.06 Prescribed
information (subsection 254 (1)) — PSTs
For the purposes of
subsection 254 (1) of the Act, the prescribed information in relation to a
pooled superannuation trust is:
(a) the following general information:
(i) the name of the trust; and
(ii) the postal address of the trust;
and
(iii) the registered address of, or an
address for service of notices on, the trust; and
(iv) a contact person, and contact
telephone and facsimile numbers; and
(b) the following trustee information:
(i) the name of the trustee, its
registered address and telephone number; and
(ii) the name of each director of the
trustee; and
(c) the date of establishment of the trust.
11.06A Specified
person or body (Act s 254 (1))
For subsection 254 (1) of the Act, the
Commissioner of Taxation is specified.
11.07 Operating
standard — disclosure of certain information (funds other than self
managed superannuation funds)
(1) For the purposes of subsections 31 (1),
32 (1) and 33 (1) of the Act, it is a standard applicable to the
operation of a superannuation entity other than a
self managed superannuation fund that the trustee must give notice in
writing to the Regulator, in accordance with subregulation (2), of any change
in:
(a) the name of the entity; or
(b) the postal address, registered address or
address for service of notices, of the entity; or
(c) details of the contact person, and contact
telephone and facsimile numbers; or
(d) the RSE licensee of the entity.
(2) A notice mentioned in
subregulation (1) must be given:
(a) in the case of a superannuation entity that
is an eligible rollover fund — immediately after the occurrence of the
change; or
(b) in any other case — within 28 days after
the occurrence of the change.
(2A) For subsections 31 (1), 32 (1) and
33 (1) of the Act, it is a standard applicable to the operation of a
superannuation entity other than a self managed superannuation fund that an
incoming trustee must give written notice to the Regulator that it has
commenced as a trustee of the entity.
(2B) A notice mentioned in subregulation (2A) must be given
as soon as practicable after the RSE licensee has commenced as a trustee of the
entity but, in any event, no later than 5 days after that date.
(3) For subsections 31 (1), 32 (1) and
33 (1) of the Act, it is a standard applicable to the operation of a
superannuation entity that the trustee must give notice in writing to the
Regulator, in accordance with subregulation (4), of:
(a) a decision or resolution to wind up the
entity; or
(b) a decision or resolution to retire as a
trustee of the entity.
(4) Notice under subregulation (3) must be given:
(a) in the case of a regulated superannuation
fund that is a self managed superannuation fund — before, or as soon
practicable after, the winding up is commenced or the trustee of the entity has
retired; or
(b) in any other case — as soon as
practicable after the making of the decision or resolution to wind up the entity
or of the trustee to retire and, in any event, before the winding up is
commenced or the trustee has retired.
11.07AA Operating
standard — disclosure of certain information (self managed superannuation
funds)
(1) For subsections 31 (1),
32 (1) and 33 (1) of the Act, it is a standard applicable to the
operation of a self managed superannuation fund that the trustee must give
notice in writing to the Regulator, in accordance with subregulation (2), of
any change in:
(a) the name of the
entity; or
(b) the postal address,
registered address or address for service of notices, of the entity; or
(c) details of the
contact person, and contact telephone and facsimile numbers; or
(d) the membership of
the fund; or
(e) the trustees of
the fund; or
(f) the directors of
the fund’s corporate trustee.
(2) A notice mentioned in subregulation (1) must be
given:
(a) using the approved
form; and
(b) within 28 days
after the occurrence of the change.
11.07A Operating
standard — disclosure on change of status
(1) For subsection 31 (1) of the Act, the
requirement in subregulation (3) is a standard applicable to the operation of a
regulated superannuation fund.
(2) The standard applies to the trustee of a
superannuation fund that:
(a) is a self managed superannuation fund and:
(i) ceases to be such a superannuation
fund; or
(ii) ceases to exist; or
(b) is not a self managed superannuation fund and
becomes such a superannuation fund.
(3) Within 28 days after the trustee first has knowledge
of such a change, the trustee must tell the Commissioner of Taxation in
writing:
(a) the fund’s name; and
(b) its ABN; and
(c) the name of an individual who is able to act
as a contact person, and his or her telephone and facsimile numbers; and
(d) the date on which the change occurred; and
(e) if the fund has not ceased to exist —
whether it has become a self managed superannuation fund; and
(f) if the fund has become a self managed
superannuation fund:
(i) for any trustee of the fund that
is an individual — his or her name, date of birth and sex; or
(ii) for any trustee that is a
corporation — its name and its ABN; and
(g) if the fund has not ceased to exist, but is
not a self managed superannuation fund after the change — the trustee’s
name and its ABN.
(4) In subregulation (3):
ABN, for an entity, means the Australian
Business Number given to the entity under the A New Tax System (Australian
Business Number) Act 1999.
Part 11A Register
to be kept by APRA
11A.01 General
(1) For subsection 353 (2) of the Act, APRA must
keep a register of:
(a) registrable superannuation entities that
have been registered under Part 2B of the Act; and
(b) the RSE licensees of those entities.
(2) APRA may determine the form and manner in which the
Register will be kept.
Note The form of register determined by
APRA must be a form that would allow the register to be inspected and copied
under subregulation (3).
(3) A person may:
(a) inspect a register; and
(b) make a copy of, or take extracts from, the
register.
11A.02 Regulated
superannuation funds
(1) The Register must contain the information set out in
subregulations (2) and (3) for each registrable superannuation entity that is a
regulated superannuation fund.
(2) The Register must contain the following information
for each registrable superannuation entity:
(a) the name
of the entity;
(c) the
postal address of the entity;
(d) the
registered address of, or an address for service of notices on, the entity;
(e) a
contact person and contact telephone and facsimile numbers for the entity;
(f) the
status of the entity under section 42 of the Act;
(g) the Australian
Business Number (the ABN) of the entity.
(3) The
Register must also contain, in relation to each registrable superannuation
entity, the following information:
(a) the
class of RSE licence held by the RSE licensee;
(b) for an
RSE licensee that is a body corporate — the RSE licensee’s:
(ii) name;
and
(iii) registered
address; and
(iv) telephone
number; and
(vi) ABN;
(c) for an
RSE licensee that is a group of individual trustees:
(i) the ABN of the RSE licensee; and
(ii) the
name of each individual trustee who is a member of the group.
11A.03 Approved
deposit funds
(1) The Register must contain the information set out in
subregulations (2) and (3) for each registrable superannuation entity that is
an approved deposit fund.
(2) The Register must contain the following information
for each registrable superannuation entity:
(a) the name
of the entity;
(c) the
postal address of the entity;
(d) the
registered address of, or an address for service of notices on, the entity;
(e) a
contact person and contact telephone and facsimile numbers for the entity;
(f) the
status of the entity under section 43 of the Act;
(g) the ABN
of the entity.
(3) The
register must also contain, in relation to each registrable superannuation
entity, the following information:
(a) the
class of RSE licence held by the RSE licensee;
(b) the RSE
licensee’s:
(ii) name;
and
(iii) registered
address; and
(iv) telephone
number; and
(vi) ABN.
11A.04 Pooled
superannuation trusts
(1) The Register must contain the information set out in
subregulations (2) and (3) for each registrable superannuation entity that is a
PST.
(2) The Register must contain the following information
for each registrable superannuation entity:
(a) the name
of the entity;
(c) the
postal address of the entity;
(d) the
registered address of, or an address for service of notices on, the entity;
(e) a
contact person and contact telephone and facsimile numbers for the entity;
(f) the
status of the entity under section 44 of the Act;
(g) the ABN
of the entity.
(3) The
Register must also contain, in relation to each registrable superannuation
entity, the following information:
(a) the
class of RSE licence held by the RSE licensee;
(b) the RSE
licensee’s:
(ii) name;
and
(iii) registered
address; and
(iv) telephone
number; and
(vi) ABN.
Part 12 Pre‑1
July 1988 funding credits and debits
12.01 Definitions
In this Part, unless the contrary intention
appears:
defined benefit fund has the meaning that
would be given by regulation 1.03 if regulated were omitted from
the definition of defined benefit fund in that regulation.
PJFC, in relation to a superannuation fund,
means an amount specified in a notice by APRA under subsection 342 (2) of the
Act.
pre‑1 July 88 funding amount has the
meaning given by regulation 12.02.
pre‑1 July 88
funding credits available has the
meaning given by subsection 295‑265 (2) of the 1997 Tax Act.
prescribed event has the meaning given by
regulation 12.10.
shortfall‑in‑assets amount means
an amount determined by an actuary in accordance with regulation 12.03.
12.02 Pre‑1
July 88 funding amounts
(1) In this regulation:
late payment amount, in relation to a
superannuation fund, means an amount (other than an amount representing a
contribution that was payable or not payable at the discretion of an employer‑contributor
in respect of the fund) representing contributions to the fund that were unpaid
as at 30 June 1988, being contributions that an employer‑contributor in
respect of the fund was obliged as at 30 June 1988 to pay in accordance
with:
(a) except if paragraph (b) applies, the
governing rules of the fund then in force; or
(b) in the case of
an amount representing contributions in respect of a member of a defined
benefit fund who is an associate of an employer‑contributor — the
determination of an actuary; or
(c) an agreement certified, or an award made, by
an industrial authority.
(2) Subject to subregulation (3), the following amounts
are to be treated as pre‑1 July 88 funding amounts for the purposes of
paragraph 342 (2) (a) of the Act:
(a) a late payment amount;
(b) a shortfall‑in‑assets amount.
(3) If:
(a) the pre‑1 July 88 funding amount of a
defined benefit fund includes a late payment amount; and
(b) that late payment amount is sufficient to
fund the liabilities of the fund in relation to accrued benefits of the members
of the fund;
the pre‑1 July 88 funding amount must not include a shortfall‑in‑assets
amount.
12.03 Shortfall‑in‑assets
amount — calculation
(1) The shortfall‑in‑assets amount in
respect of a superannuation fund is the amount determined by an actuary as the
lesser of the amounts calculated in accordance with the following formulas:
(a) 
;
(b) 
.
Note A shortfall‑in‑assets
amount is the amount of any deficiency in a superannuation fund as at 30 June
1988, other than a deficiency that is the result of contributions that are due,
but have not been paid, to the fund.
(2) In subregulation (1), in relation to a
superannuation fund:
actuarially determined value of fund assets
means the value of the assets of the fund as at 30 June 1988, including any
late payment amount, that is determined by an actuary using a method that the
actuary certifies:
(a) is consistent with the method used in the
last actuarial investigation of the fund that was completed before
25 May 1988; and
(b) as determining a value that is comparable to
the value of the assets determined in that actuarial investigation.
net market value of fund assets means the
amount that, having regard to matters specified in regulation 12.04, could
reasonably be estimated to be obtained from disposal of the assets of the fund,
and includes any late payment amount.
value A of accrued benefits has the meaning
given by regulation 12.05.
value B of accrued benefits has the meaning
given by regulation 12.06.
(3) For the purposes of this regulation:
(a) an alteration made after 25 May 1988 to the
governing rules of a superannuation fund that relates to benefits payable to
members of the fund is to be disregarded unless the alteration is a prescribed
event; and
(b) in the case of the calculation of a shortfall‑in‑assets
amount in respect of a member of a superannuation fund who is an associate of
an employer, any amount of benefits in respect of the member that is
attributable to the exercise of discretion by, or on behalf of, the trustee of
the fund is to be disregarded.
12.04 Estimation
of net market value of fund assets
For the purposes of the definition of net
market value of fund assets in subregulation 12.03 (2), the
following matters are specified:
(a) the assumptions that, when the assets are
sold:
(i) the buyer and seller of the assets
are willing, but not anxious, to buy and sell the assets; and
(ii) there is a period in which to
negotiate the sale that is reasonable, having regard to the nature and
situation of the assets and the state of the market for assets of the same
kind; and
(iii) the
assets will be reasonably exposed to the market; and
(iv) no account is taken of the value or
other advantage or benefit, additional to market value, to the buyer incidental
to ownership of the assets;
(b) the value of any estate in the property
comprising the assets that is not held by the trustee in the capacity of
trustee;
(c) deduction of the costs of disposing of the
assets from the proceeds of the disposal.
12.05 Value
A of accrued benefits
(1) Value A of accrued benefits in relation to a
superannuation fund is the total value of accrued benefits in respect of all
members of the fund as at 30 June 1988 that is calculated in accordance with
regulation 12.07.
(2) For the purposes of calculating value A of accrued
benefits, the following assumptions apply:
(a) that a member of the superannuation fund
will not die or become disabled before the member’s normal retirement from the
work force;
(b) that the governing rules of the fund
providing for benefits and the amounts of the benefits vested in members of the
fund are those rules and amounts as at 25 May 1988;
(c) that the value of the accrued benefits in
the fund in respect of a member of the fund is not less than the amount of
benefits vested in the member on 30 June 1988;
(d) if the governing rules of the fund provide
for adjustment of pension benefits to compensate for changes in the cost of
living at the discretion of the trustees of the fund, that the rules providing
for adjustment are disregarded, unless:
(i) all pension benefits have been
increased under that rule on at least 3 occasions before 30 June 1988; and
(ii) at least 1 of those increases
occurred in the period from the beginning of 1 July 1985 to the end of
30 June 1988.
(3) Subject to this regulation, the elements of the
actuarial basis for the calculation of value A of accrued benefits in respect
of a superannuation fund are taken to be those used in the last actuarial
investigation of the fund that was completed before 25 May 1988.
(4) If an actuarial investigation of a superannuation
fund was not completed before 25 May 1988, an actuary must submit to APRA in
writing the elements that the actuary proposes to use in respect of the fund:
(a) for the purposes of regulation 12.07; and
(b) in substitution for the elements referred to
in that subregulation.
(5) APRA must approve a proposed element of the
actuarial basis for the calculation of value A of accrued benefits in respect
of a superannuation fund if APRA is satisfied that the proposed element
corresponds reasonably closely to the element that would have been used if an
actuarial investigation had been made into the fund.
(6) In special circumstances, APRA may approve a
proposed element of the actuarial basis for the calculation of value A of
accrued benefits in respect of a superannuation fund if APRA is satisfied that
application of the proposed element is reasonable in those circumstances.
(7) Liability to pay tax on income of the fund is not a
special circumstance for the purposes of subregulation (6) if the liability
results directly from an amendment of the Tax Act made by the Taxation Laws
Amendment (Superannuation) Act 1989.
12.06 Value B of accrued benefits
(1) Value B of accrued benefits in relation to a
superannuation fund is the total value of accrued benefits in respect of all
members of the fund as at 30 June 1988 that is calculated in accordance with
regulation 12.07.
(2) For the purposes of calculating value B of accrued
benefits, the following assumptions apply:
(a) that a member of the superannuation fund
will not:
(i) die, or become disabled, before
the member’s normal retirement from the work force; or
(ii) withdraw from the fund, or retire
from the work force, before the age of the member’s normal retirement;
(b) that the governing rules of the fund
providing for benefits and the amounts of the benefits vested in the member are
those rules and amounts as at 25 May 1988;
(c) that the value of the accrued benefits in
the fund in respect of the member is not less than the amount of benefits
vested in the member on 30 June 1988;
(d) that the annual earning rate of the fund, net
of administrative or other costs, is 10%;
(e) that if the governing rules of the fund
provide for adjustment of pension benefits to compensate for changes in the
cost of living at the discretion of the trustees of the fund — the
adjustment factor is the lesser of:
(i) the average annual percentage
increase in pension benefits (if any) in the period from the beginning of
1 July 1985 to the end of 30 June 1988; and
(ii) 7% annually;
(f) if the
governing rules of the fund provide for adjustment of benefits to compensate
for changes in the cost of living, other than at the discretion of the trustee
of the fund, that the adjustment factor is 7% annually;
(g) if the governing rules of the fund provide
for adjustment of benefits in accordance with the amount or rate of salary of
members of the fund, that the amount or rate increases by 8.5% annually;
(h) that the probability of survival of the member
after the member’s retirement from the work force is ascertained in accordance
with the Australian Life Tables 1985‑1987 prepared by the Australian
Government Actuary.
(3) Subject to this regulation, the elements of the
actuarial basis for the calculation of value B of accrued benefits in respect
of a superannuation fund are taken to be those used in the last actuarial
investigation of the fund that was completed before 25 May 1988.
(4) In special circumstances, an actuary may submit to
APRA in writing a proposal to substitute:
(a) an assumption stated in paragraph
(2) (d), (e), (f), (g) or (h) in respect of a superannuation fund
with another assumption; or
(b) an element referred to in subregulation (3)
in respect of a superannuation fund with another element.
(5) APRA may approve a proposed assumption or element
mentioned in subregulation (4) if APRA is satisfied that application of that
assumption or element would be reasonable in the circumstances.
(6) Liability to pay tax on income of the fund is not a
special circumstance for the purposes of subregulation (4) if the liability
results directly from an amendment of the Tax Act made by the Taxation Laws
Amendment (Superannuation) Act 1989.
12.07 Calculation
of value A or B of accrued benefits
For the purposes of regulations 12.05 and 12.06,
the value of the benefits payable to a member in respect of a period after
30 June 1988 is the total of the amounts in respect of each financial
year, or part of a financial year, in the period that are determined by an
actuary:
(a) in respect of each kind of benefit that the
member is, or may be, entitled to receive from the superannuation fund; and
(b) by using the following formula:
where:
P1 is the
probability, determined by the actuary, of the member being paid a benefit in
each financial year, or part of a financial year; and
Net present value is the
value of each benefit to the fund, being an amount that is determined by the
actuary as at 30 June 1988:
(i) in the case of the calculation of
value A of accrued benefits — using the earning rate of the fund used in
the actuarial investigation of the fund mentioned in subregulation
12.05 (3); and
(ii) in the case of the calculation of
value B of accrued benefits — using the earning rate of the fund referred
to in paragraph 12.06 (2) (d); and
P2 is a proportion
that is calculated:
(i) in the case of the calculation of
value A of accrued benefits — using the method applied in the actuarial
investigation of the fund mentioned in subregulation 12.05 (3); and
(ii) in the case of the calculation of
value B of accrued benefits — as follows:
where a reference to completed period of fund membership
in relation to the member at a particular time is a reference to the period
from the time at which the member joined, or last joined, the fund to the
particular time.
12.08 Date
before which applications to be made
For the purposes of paragraph 342 (3) (b)
of the Act, the day on or before which an application in relation to a fund
must be made is the day specified for that purpose by APRA by notice in writing
given to the trustee of the fund.
12.09 Application
fees
(1) For the purposes of subparagraph
342 (3) (d) (ii) of the Act, the following application fees are
prescribed:
(a) if the application is for a PJFC that
consists of a late payment amount or is the aggregate of late payment
amounts — $300;
(b) subject to subregulation (2), if the
application is for a PJFC that consists of a shortfall‑in‑assets
amount or is the aggregate of shortfall‑in‑assets amounts, an
amount calculated using the formula:
(c) if an application is for a PJFC that
includes:
(i) a late payment amount or the
aggregate of late payment amounts; and
(ii) a shortfall‑in‑assets
amount or the aggregate of shortfall‑in‑assets amounts;
the fee prescribed in paragraph (b), as if
the PJFC consisted of a shortfall‑in‑assets amount or the aggregate
of shortfall‑in‑assets amounts.
(2) A fee under paragraph (1) (b) must not be:
(a) less than $500; or
(b) more than $5,000.
12.10 Prescribed
events for the purposes of paragraph 342 (4) (a) of the Act
(1) For the purposes of paragraph 342 (4) (a)
of the Act, a prescribed event in relation to a superannuation fund is any
alteration of the governing rules of the fund having the effect that
calculation of a pre‑1 July 88 funding amount under the rules as so
altered produces an amount that is less than the amount calculated using the
formula:
(2) A reference in subregulation (1) to a PJFC is a
reference to the amount of the PJFC multiplied by the indexation factor
calculated in accordance with Subdivision 960‑M
of the Tax Act.
12.11 When
and how APRA to be notified of prescribed events
(1) For the purposes of paragraph 342 (4) (b)
of the Act, if a prescribed event occurs in relation to a superannuation fund,
the trustee of the fund must give notice in writing to APRA of the event not
later than:
(a) a date 3 months after the date of the occurrence;
or
(b) 31 March 1995;
whichever happens last.
(2) The notice must have with it:
(a) a statement of an amount that is certified
by an actuary as the amount by which the pre‑1 July 88
funding credits available in the fund is reduced as a result of the
prescribed event; and
(b) a statement by the trustees of the fund that
describes the prescribed event in sufficient detail to allow the statement to
be properly considered.
(3) In spite of subregulation (1), APRA may give notice
in writing to the trustee of a superannuation fund extending the time in which
the trustee must give notice to APRA of a prescribed event.
12.12 Transfer
of PJFCs — trustees of transferor funds
(1) If the trustee of a defined benefit fund proposes to
transfer a PJFC, or part of a PJFC, from the fund (in this regulation called the
transferor fund) to another superannuation fund (in this regulation
called the transferee fund), the trustee may apply in writing to
APRA to approve the transfer.
(2) APRA may approve an application only if:
(a) the requirements specified in regulation
12.15 are satisfied; or
(b) if a requirement of that kind is not
satisfied — APRA is satisfied that, because of special circumstances, the
requirement does not need to be satisfied.
(3) The amount of a PJFC
to be transferred must not exceed the lesser of:
(a) the amount of the liability in respect of
benefits to be transferred to the transferee fund, being benefits accrued
before 1 July 1988; and
(b) the amount of any pre‑1 July 88
funding credits available in the transferor fund immediately before the
transfer.
(4) As soon as practicable after a decision is made by
APRA to approve a transfer, APRA must give notice in writing of the approval to
the trustees of both the transferor fund and the transferee fund.
12.13 Transfer
of PJFCs — trustees of transferee funds
(1) The trustee of a superannuation fund (in this
regulation called the transferee fund) may apply in writing to
APRA to approve the transfer of a PJFC, or part of a PJFC, from a defined
benefit fund (in this regulation called the transferor fund), if:
(a) the application arises as a direct result of
the transfer of a member or members of the transferor fund, and the benefit
entitlements of that member or those members, to 1 or more transferee funds
following reconstitution of the transferor fund into the transferee fund or
transferee funds; or
(b) the application arises as a direct result of
the transfer of a member or members of a transferor fund, and the benefit
entitlements of that member or those members, to the transferee fund following
the merger of 2 or more transferor funds into the transferee fund; or
(c) the transferee fund:
(i) was constituted on or after 1 July
1988; and
(ii) assumed responsibility for the
liabilities, but not
all the assets, in respect of contributions for superannuation purposes
relating to the employment of persons before that date, being contributions
that were made to a transferor fund.
(2) APRA may approve an application only if:
(a) the requirements specified in regulation
12.15 are satisfied; or
(b) where a requirement of that kind is not
satisfied — APRA is satisfied that, because of special circumstances, the
requirement does not need to be satisfied.
(3) The amount of a PJFC to be transferred must not
exceed the lesser of:
(a) the amount of the liability in respect of
benefits to be transferred to the transferee fund, being benefits accrued
before 1 July 1988; and
(b) the amount of any pre‑1 July 88
funding credits available in the transferor fund immediately before the
transfer.
(4) As soon as practicable after a decision is made by
APRA to approve a transfer, APRA must give notice in writing of the approval to
the trustees of both the transferee fund and the transferor fund.
12.14 Transfer
of PJFCs — revocation of approval
APRA may revoke an approval given under regulation
12.12 or 12.13 only if:
(a) information about matters relating to the
application for approval that was not available to APRA when APRA made the
decision to approve the application becomes available to APRA; and
(b) after considering that information, APRA is
satisfied that:
(i) a requirement specified in
regulation 12.15 (other than a requirement that does not need to be satisfied
under paragraph 12.12 (2) (b) or 12.13 (2) (b)) was not
satisfied in relation to the transfer; or
(ii) in the case of a requirement that,
under paragraph 12.12 (2) (b) or 12.13 (2) (b), does not
need to be satisfied — there were no special circumstances to justify the
application of that paragraph.
12.15 Transfer
of PJFCs — requirements to be satisfied
The requirements referred to in paragraph
12.12 (2) (a) and 12.13 (2) (a) are that:
(a) an actuary certifies that the amount of the
PJFC to be transferred is reasonable having regard to:
(i) the amount of unfunded liability
to be transferred from the transferor fund; and
(ii) the amount of the remaining
unfunded liability of that fund;
in relation to the amount of benefits that
have accrued before 1 July 1988; and
(b) the trustee of the transferor fund has been
given notice by APRA of the grant of the PJFC under subsection 342 (2) of
the Act; and
(c) at the date of the transfer the amount of
the PJFC to be transferred is equal to or less than the amount of the pre‑1 July 88 funding credits available in
the transferor fund; and
(d) the transferee fund is a complying
superannuation fund, in accordance with section 45 of the Act, in relation to
the year of income in which the transfer is to take place; and
(e) an actuary certifies that sufficient
information is available about the accrued entitlements of members of the
transferor fund as at 30 June 1988 to enable calculations to be made after that
date to ascertain whether a prescribed event has occurred.
12.19 Actuaries
to certify in relation to determinations
An actuary who makes a determination under this
Part must certify that the determination:
(a) is consistent with this Part; and
(b) except to the extent (if any) that this Part
otherwise requires, is made in accordance with a method that The Institute of
Actuaries of Australia would accept as a proper actuarial practice.
12.20 Substituted
accounting periods
The trustee of a superannuation fund for which the
Commissioner of Taxation has approved a 12‑month period as a substituted
accounting period for the purposes of section 18 of the Tax Act may:
(a) treat a reference in this Part to 30 June
1988 as a reference to the last day of the substituted accounting period
corresponding to the year of income that ended on 30 June 1988; and
(b) treat a reference in this Part to 1 July 1988
as a reference to the day after that day.
Part 13 Miscellaneous
Division 13.1A Transitional arrangements arising out of the Superannuation
Legislation Amendment Act (No. 3) 1999
13.10A Transitional
arrangement — preserved OSS Act provisions
(1) In this regulation:
OSS Act means the Occupational
Superannuation Standards Act 1987, as in force on 30 June 1994.
preserved OSS Act provisions means the
following provisions of the OSS Act that, despite amendment or repeal by the Occupational
Superannuation Standards Amendment Act 1993 (the Amendment Act),
have continued to apply under subsection 16 (1) of the Amendment Act:
(a) sections 4, 5, 6 and 6A;
(b) Part II;
(c) sections 10 to 15CA inclusive;
(d) Part IIIAA;
(e) the remaining provisions of the OSS Act in
so far as they relate to any or all of the provisions mentioned in the
preceding paragraphs of this definition.
superannuation standards officer has the
meaning given by the OSS Act.
(2) If a preserved OSS Act provision provides that a
thing must,
or may, be done by the Insurance and Superannuation Commissioner, and the thing
is to be done in respect of a self managed superannuation fund, the thing is
validly done if done by the Commissioner of Taxation.
(3) If a preserved OSS Act provision provides that an
action, must, or may, be taken in relation to the Insurance and Superannuation
Commissioner and a superannuation fund, and the fund in relation to which the
action is to be taken is a self managed superannuation fund, the action is
validly taken if taken in relation to the fund and the Commissioner of
Taxation.
(4) If a preserved OSS Act provision imposes an
obligation on the Insurance and Superannuation Commissioner, and the obligation
is to be carried out in relation to a self managed superannuation fund, the
obligation is taken to be imposed on the Commissioner of Taxation, and may be
carried out by a member of the Commissioner of Taxation’s staff.
(5) If a preserved OSS Act provision grants an immunity
or privilege to the Insurance and Superannuation Commissioner or a
superannuation standards officer, the immunity or privilege is taken, in
relation to a self managed superannuation fund, to be an immunity or privilege
of the Commissioner of Taxation and a member of the Commissioner of Taxation’s
staff.
13.10B Outstanding
annual returns
(1) This regulation applies to the trustee of a fund if
subsection 252G (1) of the Act requires the trustee to give an annual return, a
report, or information to the Commissioner of Taxation.
(2) Despite subsection 252G (1) of the Act, the
trustee continues, until 30 June 2000, to be under an obligation to give the
annual return, report or information to APRA rather than to the Commissioner.
13.10C Outstanding
amounts
(1) This regulation applies to the trustee of a fund if
subsection 252G (3) of the Act requires the trustee of the fund to pay an
amount to the Commissioner of Taxation.
(2) Despite subsection 252G (3) of the Act, the trustee
continues, until 30 June 2000, to be under an obligation to pay the amount to
APRA rather than to the Commissioner.
13.10D Certain
annual returns and amounts for
1999‑2000 year of income
(1) This regulation is made for section 252H of the Act.
(2) If the trustee of a superannuation entity that was a
self managed superannuation fund at any time during the 1999‑2000 year of
income of the entity gives an annual return for that year of income of the
entity before 1 July 2000, and the Act requires the return to be given to the
Commissioner of Taxation, the trustee is taken to have complied with the
requirement if the trustee gives the return to APRA.
(3) If the trustee of a superannuation entity mentioned
in subregulation (1) pays, under a prescribed Act, an amount before 1 July
2000 in respect of the 1999‑2000 year of income of the entity, and the
Act requires the amount to be paid to the Commissioner of Taxation, the trustee
is taken to have complied with the requirement if the trustee pays the amount
to APRA rather than to the Commissioner.
(4) In subregulation (3):
prescribed Act has the same meaning as in
section 252G of the Act.
Division 13.2 Various operating standards
13.11 Interpretation
In this Division:
charge includes a mortgage, lien or other
encumbrance.
recognise includes act on or give effect to.
13.12 Assignments
of superannuation interests
For the purposes of subsections 31 (1) and 32 (1)
of the Act, it is a standard applicable to the operation of regulated
superannuation funds and approved deposit funds that, subject to regulation
13.15, the trustee of a fund must not recognise, or in any way encourage or
sanction, an assignment of a superannuation interest of a member or
beneficiary.
13.13 Charges
over a member’s benefits
(1) For the purposes of
subsections 31 (1) and 32 (1) of the Act, it is a standard applicable
to the operation of regulated superannuation funds and approved deposit funds
that, subject to regulation 13.15, the trustee of a fund must not recognise, or
in any way encourage or sanction, a charge over, or in relation to a member’s
benefits.
(2) In this regulation:
charge does not include a specific charge if:
(a) the charge was exercised in respect of
particular benefits of a member before the fund became a regulated
superannuation fund or an approved deposit fund (as the case may be); and
(b) the trustee was permitted, under the
Occupational Superannuation Standards Regulations or the Superannuation
Industry (Supervision) (Transitional Provisions) Regulations, to recognise the
charge.
(3) A payment split in respect of a member’s interest in
a superannuation fund is not a charge over or in relation to the member’s
benefits for subregulation (1).
13.14 Charges
over assets of funds
For the purposes of subsections 31 (1) and
32 (1) of the Act, it is a standard applicable to the operation of
regulated superannuation funds and approved deposit funds that, subject to
regulations 13.15 and 13.15A, the trustee of a fund must not give a charge
over, or in relation to, an asset of the fund.
13.15 Restrictions
on the standards
The standards stated in regulations 13.12, 13.13
and 13.14 do not apply to an assignment or charge that is permitted, expressly
or by necessary implication, by the Act or these regulations.
13.15A Charges
in relation to certain derivatives contracts
(1) A trustee may give a charge over, or in relation to,
an asset of a fund if:
(a) the charge is given in relation to a
derivatives contract entered into:
(i) by, or on behalf of, the trustee;
or
(ii) by a broker on the instructions,
or on account, of the trustee; or
(iii) by a broker for the benefit of
the trustee; and
(b) the charge is given in order to comply with
the rules of an approved body (as defined in subregulation (2)) that requires
the performance of obligations in relation to the derivatives contract to be
secured; and
(c) the fund has in place a derivatives risk
statement that sets out:
(i) policies for the use of
derivatives that include an analysis of the risks associated with the use of
derivatives within the investment strategy of the fund; and
(ii) restrictions and controls on the
use of derivatives that take into consideration the expertise of staff; and
(iii) compliance processes to ensure
that the controls
are effective (for example, reporting procedures, internal and external audits
and staff management procedures); and
(d) the investment to which the charge relates is
made in accordance with the derivatives risk statement.
(2) In this regulation:
approved body means a body mentioned in
Schedule 4.
derivative means a financial asset or
liability the value of which depends on, or is derived from, other assets,
liabilities or indices.
derivatives contract means an options
contract or a futures contract relating to any right, liability or thing.
13.16 Accrued
benefits — restriction on alteration
(1) For the purposes of subsection 31 (1) of the Act, it
is a standard applicable to the operation of regulated superannuation funds
that, subject to subregulation (2), a beneficiary’s right or claim to accrued
benefits, and the amount of those accrued benefits, must not be altered
adversely to the beneficiary by amendment of the governing rules or by any
other act carried out, or consented to, by the trustee of the fund.
(2) The standard stated in subregulation (1) does not
apply to an alteration if:
(a) in the case of an alteration that does not
relate to minimum benefits within the meaning of Part 5:
(i) subject to subregulation (3),
written consent to the alteration has been given by:
(A) the beneficiary; and
(B) if the benefits are
subject to a payment split, the non‑member spouse; or
(ii) the Regulator has consented in
writing to the alteration after either:
(A) the alteration has been
approved by at
least two‑thirds of all of the beneficiaries
of the fund who are affected by it, in accordance with the procedures specified
in subregulation (4); or
(B) subject to subregulation
(5), if, in accordance with section 89 of the Act, the fund complies with the
basic equal representation rules, the alteration has been approved by at least
two‑thirds of the total number of trustees or, if the fund has a single
corporate trustee, by two‑thirds of the directors of the corporate
trustee; or
(b) the alteration is necessary for compliance
with:
(i) the Act, the Income Tax Act
1986, the Superannuation (Unclaimed Money and Lost Members) Act 1999
or the Tax Act; or
(ii) regulations made under any of
those Acts; or
(c) the alteration is expressly permitted by the
Act or these regulations; or
(d) the
alteration:
(i) is solely for the purpose of
rectifying a mistake which has resulted in a beneficiary’s right or claim to
accrued benefits, or the amount of the beneficiary’s accrued benefits, being
advantageously altered; and
(ii) the Regulator has approved the
alteration; or
(e) the alteration:
(i) affects only the benefits of
members in respect of whom assessments under section 15 of the Superannuation
Contributions Tax (Assessment and Collection) Act 1997 have been made;
and
(ii) serves to enable the trustee:
(A) to be reimbursed for an
amount paid, or to be paid, under that Act and the Superannuation
Contributions Tax (Imposition) Act 1997; or
(B) in relation to an amount
paid before reimbursement occurs — to charge interest on the amount paid;
or
(f) the alteration is made:
(i) to give effect to a payment split;
or
(ii) as a consequence of the trustee
taking action that, because of Division 2.2 of the Family Law
(Superannuation) Regulations 2001, has the effect that a future payment in
respect of the superannuation interest of the member spouse would not be a
splittable payment; or
(iii) as a consequence of the operation
of a fund’s governing rules that, because of Division 2.2 of the Family Law
(Superannuation) Regulations 2001, has the effect that a future payment in
respect of the superannuation interest of the member spouse would not be a
splittable payment; or
(g) the alteration enables the trustee to be
reimbursed for an amount paid, or to be paid, under section 24 of the Co‑contribution
Act.
(3) A consent referred to in subparagraph
(2) (a) (i) is not effective for the purposes of this regulation
unless, before the consent is given:
(a) the trustee of the fund has given to the
beneficiary a notice that:
(i) informs the beneficiary that it is
proposed that the beneficiary’s right or claim to accrued benefits, or the
amount of those benefits, be affected adversely; and
(ii) explains the effect of the
alteration on the beneficiary’s rights or claims to accrued benefits and the
amount of those benefits; and
(iii) provides any other information
that the trustee reasonably believes a beneficiary would expect to be told
about the proposed alteration; and
(ab) if the benefits are subject to a payment
split, the trustee has given a copy of the notice to the non‑member
spouse; and
(b) the beneficiary, and the non‑member
spouse (if any), have been allowed adequate time to consider the proposed
alteration and its effect on the beneficiary’s rights or claims to accrued
benefits and the amount of those benefits.
(4) For the purposes of sub‑subparagraph (2) (a)
(ii) (A), the procedures to be followed in obtaining the approval of
beneficiaries are as follows:
(a) the trustee of the fund must send to each
beneficiary of the fund who would be adversely affected by the alteration a
notice that:
(i) informs the beneficiary that it is
proposed that the beneficiary’s right or claim to accrued benefits, or the
amount of those benefits, be affected adversely; and
(ii) explains the effect of the
alteration on the beneficiary’s rights or claims to accrued benefits and the
amount of those benefits; and
(iii) explains
that the alteration requires:
(A) the approval of at least
two‑thirds of all of the beneficiaries of the fund who are affected by
it, obtained by ballot in accordance with this subregulation; and
(B) the consent of the
Regulator; and
(iv) explains the manner in which the
beneficiary can cast his or her vote in relation to the ballot; and
(v) provides any other information that
the trustee reasonably believes a beneficiary would expect to be told about the
proposed alteration;
(b) the ballot must be conducted in a manner that
ensures that each beneficiary is given not less than 21 days to consider the
notice and the proposed alteration before voting.
(5) An approval referred to in sub‑subparagraph
(2) (a) (ii) (B) is not effective for the purposes of this regulation unless,
at least 21 days before the giving of that approval, the trustee of the fund
has given to each beneficiary of the fund who would be adversely affected by
the alteration a notice that:
(a) informs the beneficiary that it is proposed
that the beneficiary’s right or claim to accrued benefits, or the amount of
those benefits, be affected adversely; and
(b) explains the effect of the alteration on the
beneficiary’s rights or claims to accrued benefits and the amount of those
benefits and
(c) provides any other information that the
trustee reasonably believes a beneficiary would expect to be told about the
proposed alteration.
(6) In deciding whether to consent to an alteration
under subparagraph (2) (a) (ii), the Regulator must consider the
effect that the alteration would have on the value of benefits that may become
payable to a person who is the non‑member spouse in relation to an
interest in the fund that is subject to a payment split.
13.17 Approved
deposit funds — restrictions on loans and investments
(1) For subsection 32 (1) of the Act, it is a standard
applicable to the operation of approved deposit funds that, except so far as
permitted by subregulation (2), a trustee of a fund must not, in that capacity,
invest in:
(a) the trustee
itself; or
(b) a related body corporate.
(2) Subregulation (1) does not apply to investments by a
fund in a related body corporate:
(a) in the case of a life insurance
policy — if the body corporate issuing the policy is a life insurance
company; or
(b) in the case of a deposit — if the body
corporate is an ADI; or
(c) in any other
case — if:
(i) the body corporate is an ADI or a
life insurance company; and
(ii) the trustee of the fund complies
with the rules set out in regulation 13.17AA.
13.17A Public
offer superannuation funds — restrictions on loans and investments
(1) For subsection 31 (1) of the Act, it is a
standard applicable to the operation of public offer superannuation funds that,
except so far as permitted by subregulation (2), a trustee of a fund must not,
in that capacity, invest in:
(a) the trustee itself; or
(b) a related body corporate.
(2) Subregulation (1) does not apply to investments by a
fund in a related body corporate:
(a) in the case of a life insurance
policy — if the body corporate issuing the policy is a life insurance
company; or
(b) in the case of
a deposit — if the body corporate is an
ADI; or
(c) in any other case — if:
(i) the related body corporate is an
ADI or a life insurance company; and
(ii) the trustee of the fund complies
with the rules set out in regulation 13.17AA.
13.17AA Rules
for certain investments by funds in related bodies corporate
(1) In this regulation:
prescribed investment, in relation to a fund,
means an investment (other than a deposit or a life insurance policy) in, or a
loan to, a related body corporate that is an ADI, or a life insurance company.
(2) If at the end of a year of income (the current
year of income) the value of a fund’s prescribed investments exceeds 5%
of the total assets of the fund, the trustee of the fund must prepare a written
plan in accordance with subregulations (3) and (4) as soon as practicable after
the end of the current year of income.
(3) The plan must specify the amount (the excess
amount) by which, at the end of the current year of income, the fund’s
prescribed investments exceed 5% of the fund’s total assets.
(4) The plan must set out the steps that the trustee
proposes to take in the year of income following the current year of income to
ensure that:
(a) some of the fund’s prescribed investments
are disposed of during the year of income following the current year of income;
and
(b) the value of the prescribed investments
disposed of is equal to or greater than the excess amount.
(5) The trustee must
carry out the plan.
(6) If the total value of the fund’s prescribed
investments is more than 5% of the total value of the fund’s assets, the
trustee of the fund must not make a prescribed investment.
(7) If the making of a prescribed investment would
result in the total value of the fund’s prescribed investments exceeding 5% of
the total value of the fund’s assets, the trustee of the fund must not make the
prescribed investment.
13.17B Orders
etc of the Superannuation Complaints Tribunal to be complied with
For the purposes of subsections 31 (1) and
32 (1) of the Act, it is a standard applicable to the operation of
regulated superannuation funds and approved deposit funds that the trustee of a
fund must not fail, without lawful excuse, to comply with an order, direction
or determination of the Superannuation Complaints Tribunal.
13.17C Funds
that cease to be eligible rollover funds must maintain entitlements
(1) For the purposes of subsections 31 (1) and 32 (1) of
the Act, the requirement set out in subregulation (2) is a standard applicable
to the operation of regulated superannuation funds and approved deposit funds.
(2) A fund that ceases to be an eligible rollover fund
must continue to provide those of its members who are members when it so ceases
with at least the entitlements that an eligible rollover fund must provide to
its members under the Act and these regulations as in force at the time when it
so ceases.
Division 13.3 Various prescribed matters
13.18 Sole
purpose test — specified age
For the purposes of subparagraph 62 (1) (a) (ii) of
the Act, 65 years is the specified age.
13.18A Conditional
offer of goods or services — exemptions
(1) For subsections 68A (2) and (4) of the Act, the
following kinds of goods and services are prescribed:
(a) the supply of a business loan to a person by
a trustee, or an associate of a trustee, of a regulated superannuation fund,
that is supplied:
(i) on condition that the person be a
member of the fund; and
(ii) on a commercial arm’s length
basis;
(b) a service that
is supplied by a trustee, or an associate of a trustee, of a regulated
superannuation fund to a person for the forwarding of superannuation contributions
and information:
(i) to other funds or RSAs; and
(ii) on behalf of the person; and
(iii) in relation to employees of the
person who have chosen those funds;
(c) an advice or administration service that
relates to the payment of superannuation contributions to a regulated
superannuation fund, that is supplied by a trustee, or an associate of a
trustee, of the fund to:
(i) a person; or
(ii) the employees of the person;
(d) the supply or offer to supply goods or
services to a person by a trustee, or an associate of a trustee, of a regulated
superannuation fund, only if:
(i) the supply or offer is available
to the employees of the person who are members of the fund; and
(ii) the terms of the supply or offer
to each employee are not less than the terms supplied or offered to the person.
(2) Paragraph (1) (a) does not apply to the supply of a
business loan that is supplied on the condition that a person other than the
person receiving the loan be a member of the regulated superannuation fund.
13.19 Custodians
of superannuation entities — specified amounts
For the purposes of subparagraphs
123 (1) (b) (i) and (ii) and subsection 123 (1A) of the
Act, $5,000,000 is the prescribed amount.
13.19A Disqualification
by Federal Court — matters to take into account
(1) For paragraph 126H (6) (a) of the Act, the
matters set out in this regulation are specified.
(2) In relation to subsection 126H (3) of the Act,
the matters are:
(a) whether the individual is, or has been, a
disqualified person under Part 15 of the Act, as applied by Division 2 of
Part 7 of the FHSA Act; and
(b) whether the individual has contravened the
FHSA Act (including provisions of the Act applied by Division 2 of Part 7 of
the FHSA Act) on one or more occasions; and
(c) the number, nature and seriousness of any
contraventions of the FHSA Act (including applied provisions of the Act).
(3) In relation to subsection 126H (4) of the Act,
the matters are:
(a) whether the individual is, or has been, a
responsible officer of a trustee, investment manager or custodian that is, or
has been, a disqualified person under Part 15 of the Act, as applied by
Division 2 of Part 7 of the FHSA Act; and
(b) whether the individual is, or has been, a
responsible officer of a trustee, investment manager or custodian that has
contravened the FHSA Act (including provisions of the Act applied by Division 2
of Part 7 of the FHSA Act) on one or more occasions; and
(c) the number, nature and seriousness of any
contraventions of the FHSA Act (including applied provisions of the Act).
(4) In relation to subsection 126H (5) of the Act,
the matters are:
(a) whether the individual has engaged in
conduct that relates to FHSA trusts within the meaning of the FHSA Act on one
or more occasions; and
(b) whether any conduct of that kind makes it
reasonable to conclude that the individual is not a fit and proper person to be
a person referred to in subsection 126H (2) of the Act.
13.20 Advertisement
of scheme for winding‑up or dissolution of superannuation entity
For the purposes of subsection 142 (7) of the
Act, the prescribed form of advertisement is as set out in Schedule 3.
13.21 Report
of inspector — prescribed agencies
For the purposes of subparagraph
284 (3) (c) (iv) of the Act, the following agencies are prescribed:
(a) Australian Capital Territory —
Registrar of Financial Institutions;
(b) Australian Financial Institutions Commission;
(c) Australian Securities Commission;
(d) Australian Transactions Reports and Analysis
Centre;
(e) Commissioner of Taxation;
(f) New South Wales Crimes Authority;
(g) New South Wales Financial Institutions
Commission;
(h) New South Wales Independent Commission
against Corruption;
(i) Northern Territory Supervisory
Authority — Registrar of Financial Institutions;
(j) Queensland Criminal Justice Commission;
(k) Queensland Office of Financial Supervision;
(l) Reserve Bank of Australia;
(m) South Australian Office of Financial
Supervision;
(n) Tasmanian Office of Financial Supervision;
(o) Victorian Financial Institutions Commission;
(p) Western Australian Financial Institutions
Authority;
(q) an authority of a State or Territory having
functions and powers similar to those of the Director of Public Prosecutions;
(r) the police force of a State or Territory.
13.22 Statements
made at an examination — manner of authentication
For the purposes of subsection 290 (7) of the
Act, it is a prescribed manner of authentication of a written record of an
examination mentioned in the subsection if:
(a) the written record is produced as soon as
practicable after the conclusion of the examination; and
(b) the written record is endorsed by a person (the
endorser) other than the person examined at the examination; and
(c) the endorser:
(i) was present throughout the
examination; and
(ii) reads and endorses the written
record as soon as practicable after it is produced; and
(d) the
endorsement:
(i) is to the effect that the record
is a true record of what was said in the examination; and
(ii) is signed and dated by the
endorser.
Division 13.3A In‑house assets of superannuation funds
13.22A Definitions
for Division 13.3A
In this Division:
business real property has the meaning given in subsection 66 (5) of the
Act.
lease arrangement means any agreement, arrangement or understanding in the
nature of a lease (except a lease) under which one party is to use, or control
the use of, property of another party, whether or not the agreement,
arrangement or understanding is enforceable, or intended to be enforceable, by
legal proceedings.
trustee, of a unit trust, means a trustee acting in the capacity
of trustee.
13.22B Assets
held at commencement of Division 13.3A (Act s 71)
(1) This regulation applies to an asset of a
superannuation fund that:
(a) is an investment in a company or unit trust;
and
(b) was acquired by the fund before the
commencement of this Division; and
(c) is not affected by subregulation
13.22D (3).
(2) For subparagraph 71 (1) (j) (ii) of
the Act, the asset is not an in‑house asset of the superannuation fund
if, when this Division commences:
(a) the superannuation fund has fewer than
5 members; and
(b) the company, or a trustee of the unit trust,
is not a party to a lease with a related party of the superannuation fund,
unless the lease relates to business real property; and
(c) the company, or a trustee of the unit trust,
is not a party to a lease arrangement with a related party of the
superannuation fund, unless the lease arrangement:
(i) is legally binding; and
(ii) relates to business real property;
and
(d) the company, or a trustee of the unit trust,
is not a party to a lease, or lease arrangement, with another party in relation
to an asset that is the subject of another lease or lease arrangement between
any party and a related party of the superannuation fund (unless the asset is
business real property); and
(e) the company, or a trustee of the unit trust,
does not have outstanding borrowings; and
(f) the assets of the company or unit trust do
not include:
(i) an interest in another entity; or
(ii) a loan to another entity, unless
the loan is a deposit with an authorised deposit‑taking institution
within the meaning of the Banking Act 1959; or
(iii) an asset over, or in relation to,
which there is a charge; or
(iv) an
asset that was acquired from a related party of the superannuation fund after
11 August 1999, unless the asset was business real property acquired at
market value; or
(v) an asset that had been, at any time
(unless it was business real property acquired by the company, or a trustee of the
unit trust, at market value) in the period from the end of 11 August 1999 to
the commencement of this Division, an asset of a related party of the
superannuation fund.
(3) In subparagraphs (2) (f) (iv) and (v):
asset does not include:
(a) money; or
(b) in relation to a company, a share in the
company.
13.22C Assets
acquired after commencement of Division 13.3A (Act s 71)
(1) This regulation applies to an asset of a
superannuation fund that:
(a) is an investment in a company or unit trust;
and
(b) was acquired by the fund on or after the
commencement of this Division; and
(c) is not affected by subregulation
13.22D (3).
(2) For subparagraph
71 (1) (j) (ii) of the Act, the asset is not an in‑house
asset of the superannuation fund if, when the asset is acquired:
(a) the superannuation fund has fewer than
5 members; and
(b) the company, or a trustee of the unit trust,
is not a party to a lease with a related party of the superannuation fund,
unless the lease relates to business real property; and
(c) the company, or a trustee of the unit trust,
is not a party
to a lease arrangement with a related party of the superannuation fund, unless
the lease arrangement:
(i) is legally binding; and
(ii) relates to business real property;
and
(d) the company, or a trustee of the unit trust,
is not a party to a lease, or lease arrangement, with another party in relation
to an asset that is the subject of another lease or lease arrangement between
any party and a related party of the superannuation fund (unless the asset is
business real property); and
(e) the company, or a trustee of the unit trust,
does not have outstanding borrowings; and
(f) the assets of the company or unit trust do
not include:
(i) an interest in another entity; or
(ii) a loan to another entity, unless
the loan is a deposit with an authorised deposit‑taking institution
within the meaning of the Banking Act 1959; or
(iii) an asset over, or in relation to,
which there is a charge; or
(iv) an
asset that was acquired from a related party of the superannuation fund after
11 August 1999, unless the asset was business real property acquired at
market value; or
(v) an asset that had been at any time
(unless it was business real property acquired by the company, or a trustee of
the unit trust, at market value) an asset of a related party of the
superannuation fund since the later of:
(A) the end of 11 August
1999; and
(B) the day 3 years before
the day on which the fund first acquired an interest in the company or unit
trust.
(3) In subparagraphs (2) (f) (iv) and (v):
asset does not include:
(a) money; or
(b) in relation to a company, a share in the
company.
13.22D When
regulations 13.22B and 13.22C cease to apply to assets
(1) If regulation 13.22B or
13.22C applies to an asset, that regulation ceases to apply to the asset if any
of the following events happens:
(a) the number of
members of the superannuation fund increases to 5 or more;
(b) either of the following becomes an asset of
the company or unit trust:
(i) an
interest in another entity;
(ii) a loan to another entity, unless
the loan is a deposit with an authorised deposit‑taking institution
within the meaning of the Banking Act 1959;
(c) the company, or a
trustee of the unit trust:
(i) borrows
money; or
(ii) gives, or allows to be given, a
charge over, or in relation to, an asset of the company or unit trust;
(d) the company, or a
trustee of the unit trust, conducts a business;
(e) the company, or a trustee of the unit trust,
becomes a party to a lease with a related party of the superannuation fund,
unless the lease relates to business real property;
(f) the company, or a trustee of the unit trust,
becomes a party to a lease arrangement with a related party of the
superannuation fund, unless the lease arrangement:
(i) is legally binding; and
(ii) relates to business real property;
(g) if the company, or
a trustee of the unit trust, is a party to a lease, or legally binding lease
arrangement, with a related party of the superannuation fund in relation to
business real property, the property ceases to be business real
property;
(h) if the company, or a trustee of the unit
trust, is a party to a lease arrangement with a related party of the
superannuation fund in relation to business real property, the lease
arrangement ceases to be legally binding;
(i) the company, or a trustee of the unit
trust, becomes a party to a lease, or lease arrangement, with another party in
relation to an asset (unless it is business real property) that is the subject
of another lease or lease arrangement between any party and a related party of
the superannuation fund;
(j) a related party of the superannuation fund
becomes a party to a lease, or lease arrangement, with another
party in relation to an asset (other than business real property) that is the
subject of another lease or lease arrangement between any party and:
(i) the company; or
(ii) a trustee of the unit trust;
(k) if the company, or
a trustee of the unit trust, is a party to a lease, or lease
arrangement, with another party in relation to business real property that is
the subject of another lease or lease arrangement between any party and a
related party of the superannuation fund, the
property ceases to be business real property;
(l) the company, or a trustee of the unit
trust, conducts a transaction otherwise than on an arm’s length basis;
(m) the company, or a trustee of the unit trust,
acquires an asset of a related party of the superannuation fund, unless the
asset is business real property acquired at market value;
(n) the company, or a trustee of the unit trust,
acquires from any party an asset (unless it is business real property acquired
by the company, or trustee of the unit trust, at market value) that had been an
asset of a related party of the superannuation fund at any time since the later
of:
(i) the end of 11 August 1999; and
(ii) the day 3 years before the day on
which the asset was acquired by the company or the trustee of the unit trust.
(2) In paragraphs (1) (m) and (n):
asset does not include:
(a) money; or
(b) in relation to a company, a share in the
company.
(3) If regulation 13.22B or 13.22C ceases to apply to an
asset of a superannuation fund, neither regulation applies to any other asset
of the fund that is:
(a) acquired by the fund at any time; and
(b) an interest in the company or unit trust.
Division 13.4 Repeal
13.23 Superannuation
Industry (Supervision) (Approval of Trustees) Regulations
Statutory Rules 1993 No. 373 are repealed.
Division 13.5 Reconsideration and review of decisions
13.24 Notice
of reviewable decisions and reasons for decisions
(1) As soon as practicable after the Regulator makes a
reviewable decision, the Regulator must give written notice of the decision to
the person at whose request the decision was made.
(2) The notice must have with it a statement by the
Regulator of the Regulator’s reasons for making the decision.
(3) The notice must include a statement to the effect
that, if dissatisfied with the decision, the person may:
(a) in the case of notice of a decision (other
than a decision made by the Regulator under regulation 13.25 confirming or
varying an earlier reviewable decision of the Regulator) — request
reconsideration of the decision under regulation 13.25; and
(b) in the case of notice of a decision made by the
Regulator under regulation 13.25 confirming or varying an earlier reviewable
decision of the Regulator — apply to the Administrative Appeals Tribunal
for review of the decision so confirmed or varied.
(4) Failure to comply with subregulation (3) in relation
to a decision does not affect the validity of the decision.
13.25 Reconsideration
of certain decisions
(1) If a person is dissatisfied with a reviewable
decision (other than a decision made by the Regulator under this regulation),
the person may give notice in writing to the Regulator within:
(a) the period of 21 days after the day on which
the person first receives notice of the decision; or
(b) such further period as the Regulator
reasonably allows;
requesting the Regulator to reconsider the decision.
(2) The person must set out in the notice the reasons
for the request.
(3) Subject to subregulation (4), the Regulator must
reconsider the decision and may:
(a) confirm the decision; or
(b) vary or revoke the decision.
(4) If the Regulator does not confirm, vary or revoke
the decision before the end of the period of 60 days after the day on which the
Regulator received the request, the Regulator is taken to have confirmed the
decision under subregulation (3) at the end of that period.
(5) If the Regulator varies or revokes a decision made
under regulation 12.12, 12.13 or 12.14, the Regulator must give written notice
of the variation or revocation to the Commissioner of Taxation.
13.26 Review
by Tribunal of reconsidered decisions
Application may be made to the Administrative
Appeals Tribunal for review of a decision of the Regulator to confirm or vary a
decision under subregulation 13.25 (3), including a decision that is taken
under subregulation 13.25 (4) to have been confirmed.