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This edited version has been archived due to the length of time since original publication. It should not be regarded as indicative of the ATO's current views. The law may have changed since original publication, and views in the edited version may also be affected by subsequent precedents and new approaches to the application of the law.

You cannot rely on this record in your tax affairs. It is not binding and provides you with no protection (including from any underpaid tax, penalty or interest). In addition, this record is not an authority for the purposes of establishing a reasonably arguable position for you to apply to your own circumstances. For more information on the status of edited versions of private advice and reasons we publish them, see PS LA 2008/4.

    Edited version of your written advice

    Authorisation Number: 1013049468858

    Disclaimer

    You cannot rely on this edited version in your tax affairs. You can only rely on the advice that we have given to you or to someone acting on your behalf.

    The advice in the Register has been edited and may not contain all the factual details relevant to each decision. Do not use the Register to predict ATO policy or decisions.

    Date of advice: 13 July 2016

    Ruling

    Subject: Transition to retirement income stream

    Questions

    Will the facts described in your application for a private ruling enliven Part IVA of the Income Tax Assessment Act 1936?

    Answers

    No.

    This ruling applies for the following period

    Income year ending 30 June 2016

    Income year ending 30 June 2017

    The scheme commenced on

    1 July 2015

    Relevant facts and circumstances

    Your client (the Taxpayer) is, or will be shortly, receiving a benefit (the Benefit) from a superannuation interest that is supporting a superannuation income stream from a complying superannuation fund.

    The superannuation income stream from which the Benefit is, or will be, paid satisfies the definition of an 'account based pension' under subregulation 1.03(1) of the Superannuation Industry (Supervision) Regulations 1994 (SISR) and under all other relevant provisions of superannuation law.

    The superannuation income stream from which the Benefit is, or will be, paid also meets the definition of a 'transition to retirement income stream' (TRIS) in subregulation 6.01(2) of the SISR.

    The capital supporting the superannuation income stream from which the Benefit is, or will be, paid is comprised substantially or entirely of preserved benefits.

    The superannuation income stream from which the Benefit is, or will be, paid is comprised substantially or entirely of taxable component.

The conditions to which the superannuation income stream is (or will shortly be) subject allow for the variation of the amount of the Taxpayer's benefit payments in a year in circumstances other than:

    • the indexation of the Benefit under the rules of the product;

    • the application of the family law splitting provisions;

    • the commutation of the Benefit (including commutation to pay a surcharge liability); or

    • the payment of an assessment of excess contributions tax.

    The superannuation income stream from which the Benefit is, or will be, paid at all relevant times allows the amount of the Benefit to be anywhere between at least 4% of the relevant account balance and no more than 10% of the relevant account balance.

    The Taxpayer will elect under regulation 995-1.03 of the ITAR 1997, before each Benefit is paid, that the Benefit is not to be treated as a superannuation income stream benefit.

    Relevant legislative provisions

    Income Tax Assessment Act 1936

    Further issues for you to consider

    N/A

    Anti-avoidance rules

    N/A

    Reasons for decision

    Does Part IVA apply to this ruling?

    Part IVA of the Income Tax Assessment Act 1936 (ITAA 1936) is a general anti-avoidance provision that gives the Commissioner the power to cancel a 'tax benefit' that has been obtained in connection with a scheme to which Part IVA applies and it can be concluded that the arrangement, or any part of it, was entered into or carried out by any person for the dominant purpose of obtaining the tax benefit.

    The Commissioner has considered the circumstances of your case and will not apply Part IVA of the ITAA 1936 to the arrangement described in this case.


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