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Total superannuation balance

Adjustment for structured settlement contributions

Section: 18.7

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 member 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.

When calculating total super balance, any structured settlement contributions are removed.

If the member 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 member 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 member's calculated total superannuation balance is then reduced by the value of any structured settlement contributions.

Transitional provisions

If a member has made contributions from a structured settlement prior to 1 July 2017, an alternative debit rule is applied to the amount that's debited to their transfer balance account. If the total values of the retirement phase superannuation interests that they had on 1 July 2017 are more than the amount of the structured settlement contribution, the debit will be equal to the total of those credits. This is to ensure that there is no disadvantage in the situation where a member's superannuation interest on 1 July 2017 is greater than the amount of the original structured settlement contribution.

As well as being excluded from the total superannuation balance, structured settlement contributions are exempt from the non-concessional contributions cap.

Last modified: Wednesday, July 24, 2019