SPAA calls for refinements to pension relief

The Federal Government needs to reconsider the retrospective elements of the relief granted to self-managed superannuation fund (SMSF) complying pensions that do not meet the high probability actuarial test, according to the Self Managed Super Fund Professionals’ Association of Australia (SPAA).

SPAA technical director Peter Burgess said while the relief was both welcome and sensible, it needed refinement to ensure its retrospective elements did not disadvantage some individuals.

He pointed out that as a result of the Government’s relief move, asset test exemption pensions sourced from a SMSF before September 20, 2004, would be permitted to be commuted to an account-based market-linked income stream without a Centrelink debt being raised until June 30 next year.

Burgess said removing the five-year Centrelink claw-back was a responsible concession that would now allow individuals to move to a simpler account-based pension without a Centrelink debt being incurred.

However, he said asset test exempt pensions that failed the high probability test and were transferred to a market-linked income stream would no longer be entitled to any form of asset test exemption both before and after transfer, and this was an anomaly SPAA believed needed to be addressed