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20 Nov 14 SMSFs: maximum and minimum amounts on commutation of TTR account based pension - SMSFD 2014/1

On 19 November 2014, the ATO issued Self-Managed Superannuation Fund Determination SMSFD 2014/1 entitled "Self-Managed Superannuation Funds: does a payment made as a result of a commutation of an account based pension that is a transition to retirement income stream count towards the minimum and maximum annual payment amounts set out in the SIS Regulations for such a pension?"

SMSFD 2014/1 was not previously released in draft form.

The answer to the question posed is as follows:

"1. A payment made as a result of a partial commutation of an account based pension that is a transition to retirement income stream counts towards the minimum annual amount required to be paid from the pension account under paragraph 1.06(9A)(a) of the SIS Regulations ('the minimum annual amount'), unless the payment is rolled over within the superannuation system on or after 6 June 2009. Such a payment that was rolled over within the superannuation system before 6 June 2009 counts towards the minimum annual amount.

2. A payment made as a result of a partial commutation of an account based pension that is a transition to retirement income stream does not count towards the maximum annual amount allowed to be paid from the pension account under subparagraph (b)(ii) of the definition of 'transition to retirement income stream' in subregulation 6.01(2) of the SIS Regulations ('the maximum annual amount') where the payment was made on or after 16 February 2008. However, such a payment made before 16 February 2008 does count towards the maximum annual amount.

3. A payment made as a result of a full commutation of an account based pension that is a transition to retirement income stream cannot count towards the minimum annual amount or the maximum annual amount as that pension ceases before the payment is made."

The Determination applies from 1 July 2007.


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