4 Comments Super, Managed Funds, Wealth, Insurance, SMSF, Pensions
Under the Grandfathering rules for centrelink. The Account based pensions commenced prior 1st January 2015 will retain their current income treatment, where the client receives an eligible income support payment immediately before 1st January 2015.
Grandfathering also extends to a pre 2015 account based pension that later automatically reverts to a reversion beneficiary on the death of the original owner.
What may impact the grandfathering is the following
Structure of the SMSF is it corporate or individual?
Are you already receiving a centrelink pension?
Thank you for the response.
The fund is just for my husband and myself and he administers it.
Neither of us are on Centrelink pensions.
It was set up well before 1/1/15 and I understand that as long as we don't restructure it, the old rules will apply.
The fund has 2 sections, mine and his. We both draw down pensions from our respective parts. In his will, his part of the fund is to be liquidated to form part of his estate. I will not have the knowledge to administer my part so will probably need to restructure MY part i.e. purchase a commercial annuity. My query is, will the grandfathering allow me to draw down on this new product tax free if I do this? Or maybe I would be better off just getting my accountant to administer my part and just keep it as it is?
What do you think?
To be entitled to the grandfathering, the following would need to have been meet before the 1st of Jan 2015
-The client received an eligible income support payment immediately before 1st Jan 2015
-The account based pension was commenced prior to 1st Jan 2015
-The old rule continues to apply into the future provider that the existing account base pension continues. This is tricky one, if you change the product then this may change the deeming status. E.g. If you took the money out of the super environment, and put the money in a cash account this would change product and the money could count towards the new rule.
You need to check whether you qualify,
Were you entitled to receive a pension before the 1st of Jan 2015?
I was not entitled to any Centrelink pensions before 1/1/15, and due to my husband's assets I will not be eligible in the foreseeable future.
I have been drawing down an annuity payment from my portion of the superfund for about 3 years.
I think you have answered my question. If the SMSF has to be wound up if my husband dies, I will keep my portion of the fund as is and place into the hands of an administrator.
I appreciate your advice in helping me to clarify what I need to do.