Assistant treasurer Stuart Robert has used a speech to the Alliance for a Fairer Superannuation System to announce the Government plans to change the law to ensure that death benefits that include life insurance proceeds are not subject to tax when rolled over to a new super fund.
The Minister announced several other technical superannuation changes, including:
- Amending the law to maintain the treatment of market-linked pensions under the transfer balance cap (TBC) where they have been rolled over because of a successor fund transfer;
- Fixing the definition of life-expectancy period for innovative income streams to account for days in a leap year;
- Providing TBC credits and debits for innovative income stream products that are paid off in instalments; and
- Fixing the valuation of defined benefit pensions under the TBC to reflect when pensions are permanently reduced.
The SMSF Association today welcomed the death benefits proposal, with chief executive John Maroney saying that it was “extremely important” to people who had been waiting for an amendment before dealing with death benefit sums.
While Maroney was also in favour of the TBC and market-linked pension changes, he called on the Government to further consider unresolved technical superannuation fixes as per previous submissions by the Association.