Ross Stephens highlights the Government's proposed superannuation reforms impacting transition retirement income streams.
On 13 April 2017, the Government released for public consultation an Exposure Draft and explanatory materials for what it called “minor and technical amendments to the 2016 superannuation reform package”. Within the proposed changes is a crucial measure that will assist significantly in implementing the measures relating to Transition to Retirement Income Streams (TRISs).
The Government’s 2016 reform package provided that TRISs would no longer be eligible for the 0 percent tax rate on earnings. This change applied to all TRISs, including those where the member had since met a ‘nil condition of release’ (generally by attaining age 65 or fully retiring from the workforce).
This had the potential to create significant difficulties:
The Government is to be commended for listening to the industry’s concerns on this issue.
Unsegregated funds should take the opportunity arising from this greater certainty about the extent of the TRISs losing entitlement to the 0 percent rate, to now prioritise their analysis as to whether or not to apply the CGT uplift relief.
© 2019 KPMG, an Australian partnership and a member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved.
KPMG International Cooperative (“KPMG International”) is a Swiss entity. Member firms of the KPMG network of independent firms are affiliated with KPMG International. KPMG International provides no client services. No member firm has any authority to obligate or bind KPMG International or any other member firm vis-à-vis third parties, nor does KPMG International have any such authority to obligate or bind any member firm.