Total superannuation balance
Adjustment for structured settlement contributions
Once the sum of the accumulation phase value, retirement phase value (including the effect of any adjustments) and any roll-over amounts is calculated, this total is modified to remove any structured settlement contributions.
If the client does not have a transfer balance account, this simply involves reducing the calculated total superannuation balance by the value of any structured settlement contributions.
However, if the client has a transfer balance account, that account (which is normally already reduced by the value of structured settlement contributions) is calculated without including structured settlement contribution debits. The client's calculated total superannuation balance is then reduced by the value of any structured settlement contributions.
A structured settlement contribution is a contribution to a complying superannuation fund that arises from the settlement of a personal injury claim where two legally qualified medical practitioners have certified that because of a personal injury, it is unlikely the client can ever be gainfully employed in a capacity for which they are reasonably qualified or trained.
A contribution qualifies as a structured settlement contribution if it:
- meets the requirements of Section 292-95 of the Income Tax Assessment Act, or
- would have met the requirements of the above section (apart from certain timeframes) but was made prior to the introduction of contributions cap rules on 10 May 2006.
As well as being excluded from the total superannuation balance, structured settlement contributions are exempt from the non-concessional contributions cap.
Last modified: Wednesday, August 23, 2017