The Government’s decision to release draft legislation regarding a Reversionary Transition to Retirement Income Stream (TRIS) is a “positive initiative,” according to the SMSF Association.
The legislation would ensure that a TRIS automatically transfers to eligible dependants on the death of the primary recipient. This would remove the compliance burden involved in ending then starting a new death benefit pension when the beneficiary had not met their own condition of release.
It would also give TRISs a 12-month delay for the transfer balance credit to occur on the death of an individual, which the Association said would give the beneficiary time to get their affairs in order.
The proposal would give reversionary TRISs the same legal position as reversionary account-based pensions.
SMSF Association chief executive, John Maroney, commended the Government for acting quickly to further ensure that the 2016-17 Budget’s superannuation tax reform package was smoothly implemented.
He then called on the Government to consider the red-tape issues, of which the TRIS was one, put forward in the Association’s pre-budget submission.