Treasury Laws Amendment (Fair and Sustainable Superannuation) Act 2016 (81 of 2016)

Schedule 11   Dictionary

Income Tax Assessment Act 1997

6   Section 960-285

Repeal the section, substitute:

960-285 Indexation - superannuation and employment termination

(1) This section applies in relation to the amounts listed at items 8 to 12 in section 960-265.

Indexing amounts

(2) You index the amount by:

(a) first, multiplying its base amount mentioned in subsection (3) by its *indexation factor mentioned in subsection (5); and

(b) next, rounding the result in paragraph (a) down to the nearest multiple of its *rounding amount.

Example 1: An amount of $140,000 is to be indexed, with a rounding amount of $5,000. If the indexation factor increases this to an indexed amount of $143,000, the indexed amount is rounded back down to $140,000.

Example 2: An amount of $140,000 is to be indexed, with a rounding amount of $5,000. If theindexation factor increases this to an indexed amount of $146,000, the indexed amount is rounded down to $145,000.

(3) The amount (the base amount ) for an amount to which this section applies is:

(a) unless paragraph (b) applies - the amount for the 2007-2008 income year or *financial year; or

(b) if the amount is mentioned in item 9 or 10A in section 960-265 - the amount for the 2017-2018 financial year.

(4) You do not index the amount if the *indexation factor is 1 or less.

Indexation factor

(5) For indexing an amount, its indexation factor is:

where:

base quarter means:

(a) unless paragraph (b) applies - the quarter ending on 31 December 2006; or

(b) if the amount is mentioned in item 9 or 10A in section 960-265 - the quarter ending on 31 December 2016.

(6) You work out the *indexation factor mentioned in subsection (5) to 3 decimal places (rounding up if the fourth decimal place is 5 or more).

Index numberand rounding amount

(7) For indexing an amount to which this section applies:

(a) the index number for a *quarter is set out in column 2 of the relevant item in the following table; and

(b) the rounding amount is set out in column 3 of that item.