Gov’t agrees to same-sex super entitlements
The Federal Government has given in to long term pressure by lobby groups and the Democrats to offer the same superannuation benefits to same-sex couples in the area of tax-free superannuation death benefits.
The changes were announced yesterday by the Minister for Revenue and Assistant Treasurer, Senator Helen Coonan as part of a wider change to cover those in ‘interdependent’ relationships.
“This is a family friendly proposal which recognises that adult family members who reside together and offer each other mutual support may not receive the same treatment as spouses or dependent children upon the death of a partner or family member,” Coonan says.
According to Coonam there has been concern surrounding interdependent adult relationships and that some may not fall within the current definition of financial dependency which the Minister has stated as “one of continuing mutual commitment to financial and emotional support between two people who reside together”.
Coonan says example of interdependent relationships include those with disabilities dependent on another adult, elderly siblings who live together and an adult child who resides with and cares for an elderly parent.
The legislation has yet to reach Parliament but would allow a member of an interdependent couple to nominate their partner to receive their superannuation benefits when they die but also opens the way for same-sex couples to receive the super benefits.
In doing so the tax free status on the benefits applied to opposite sex couples will now also apply to same-sex couples.
Under currently industry regulations within the Superannuation Industry (Supervision) Act 1993 (SIS) superannuation funds were not able to pay death benefits to a same-sex partner unless they could demonstrate they were financially dependent on the deceased member, which in many cases had been difficult to prove.
The moves have been welcomed by theAssociation of Superannuation Funds of Australia(ASFA) which says the changes open the way for gay and lesbian couples living together in interdependent relationships to inherit their partner's super.
“ASFA wholeheartedly supports this move to remove discrimination against same-sex couples in a superannuation context,” ASFA chief executive Philippa Smith says.
AUTHOR
Jason Spits
Recommended for you
The top five licensees are demonstrating a “strong recovery” from losses in the first half of the year, and the gap is narrowing between their respective adviser numbers.
With many advisers preparing to retire or sell up, business advisory firm Business Health believes advisers need to take a proactive approach to informing their clients of succession plans.
Retirement commentators have flagged that almost a third of Australians over 50 are unprepared for the longevity of retirement and are falling behind APAC peers in their preparations and advice engagement.
As private markets continue to garner investor interest, Netwealth’s series of private market reports have revealed how much advisers and wealth managers are allocating, as well as a growing attraction to evergreen funds.
