From 1 July 2019, new means test rules for lifetime income streams came into effect. The Department of Human Services explains more –
The new rules change the way we assess lifetime income streams (LIS) purchased from 1 July 2019.
Under the new rules we’ll assess:
- A minimum of 60% of its purchase amount as an assessable asset;
- 60% of the payments you get from the lifetime income stream as income.
We use the Capital Access Schedule (CAS) to help us determine how much of your income stream we’ll assess. The CAS is a part of the Superannuation Industry Supervision Regulations.
Some income stream products may have a surrender value or death benefit that’s higher than allowed under the CAS. Where this is the case we may assess more than 60% of the purchase amount.
The changes ensure fairer means test outcomes across all LIS.
If you’re under Age Pension age and your payments haven’t started yet, all LIS products you purchase with:
- Savings may be subject to deeming;
- Superannuation money may be exempt from means testing.
We’ll still assess LIS purchased before 1 July 2019 under the rules which applied prior to this date.
If you make any changes that may affect your circumstances you have to tell us. You have 14 days to tell us from the date they occur.
Read more about Income streams.
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