Super income stream
You need to report the commencement of all retirement phase super income streams. Generally, these afford a member the right to receive periodic payments from a super interest, for example a pension or annuity.
Reversionary income stream
Report a super income stream that automatically reverts to a nominated beneficiary on the death of its current recipient.
Note: It is important that you report the TFN and personal details of the beneficiary, not the details of the deceased member.
For closing and opening the account in MAAS, see Member account transaction and attribute service reporting.
Child death benefit income stream
Report a child death benefit income stream where a dependent child receives a death benefit income stream because of the death of a parent.
Reversionary child death benefit income stream
Report a reversionary child death benefit income stream where a super income stream automatically reverts to a dependent child because of the death of a parent.
Note: It is important that you report the TFN and personal details of the beneficiary, not the details of the deceased member.
For closing and opening the account in MAAS, see Member account transaction and attribute service reporting.
Member commutation
A member commutation is the process of ceasing, in whole or in part, a super income stream and converting it into a super lump sum. The member may take the lump sum as a benefit or commute it back to accumulation in the same fund, start a new income stream in the same fund or roll the amount over to a different fund. A member commutation should be reported in all circumstances where a voluntary commutation occurs (that is – with the exception of when a commutation is made in response to a commutation authority).
A member commutation should also be reported because a commutation is required to split the interest as a consequence of a family court order. Where the interest is retained by the member, but the payments are split to a non-member spouse then a member commutation is not reported by the fund. This information is reported to us by the member or non-member spouse using a Transfer balance event notification form (NAT 74919).
Income stream stopped
This event type is used to report when an income stream stops being in the retirement phase. This does not relate to a member commutation or non-compliance with a commutation authority. The most likely use of this reporting event is if the income stream fails to meet the minimum pension payment standards.
Do not report a stopped income stream due to the interest being exhausted through income stream payments. There are no reporting obligations in this situation.
You are not required to report an income stream has stopped due to a deceased member. If the income stream results in the payment of a death benefit income stream, that event would need to be reported as a credit event for the beneficiary with the personal details and TFN of the beneficiary not the deceased, see Reporting retirement phase events for deceased members.
Limited recourse borrowing arrangement (generally only applicable for SMSFs)
Report each transfer balance cap credit arising from the repayment of a limited recourse borrowing arrangement which commenced from 1 July 2017 for a member with a retirement phase account.
Examples
All examples in this chapter deal only with the transfer balance cap reporting requirements. Requirements to open, close or update accounts are found in the Member account transaction and attribute service reporting.
Example 1: non-reversionary death benefit income stream
Don Bradfield is in receipt of a non-reversionary income stream and dies on 12 March 2019. Don's income stream is commuted to a lump sum on 30 May 2019 and is paid to start a death benefit income stream for his wife Mary within the same fund. No retirement phase event reporting is required for Don. The fund needs to report a new super income stream (SIS) for Mary effective as at 30 May 2019.
End of example
Example 2: minimum payment not made
In example 1, Mary's new income stream starts on 30 May 2019. The fund notes on 10 July 2020 that the minimum pension payment has not been made for Mary for the 2019–20 financial year. The fund reports that the income stream stopped (STO) using the full value of the income stream at the end of the 2019–20 financial year. The effective date reported for this event is 30 June 2020. Mary fully commutes the income stream on 31 July 2020, but this commutation does not need to be reported for transfer balance cap purposes because the income stream is not in retirement phase at that time. She then starts a new retirement phase income stream that complies with the pension or annuity standards on 1 August 2020 and the fund reports this as a new income stream (SIS) reporting the value as at 1 August 2020.
End of example
Example 3: reversionary death benefit income stream then rolled over
From example 1 –, Don's income stream is reversionary and reverts automatically to Mary. The fund (Fund A) reports a reversionary income stream (IRS) for Mary effective 12 March 2019 which will not generate a credit to Mary's transfer balance account until 12 months later. No retirement phase event reporting is required for Don.
Mary's income stream is then rolled over to Fund B on 20 April 2019. Fund A reports a member commutation (MCO), and Fund B reports a super income stream (SIS), both do this effective 20 April 2019.
End of example
Example 4: reversionary child death benefit income stream
From example 1 – Don's income stream reverts automatically to his dependant daughter Beverley. Fund A reports a child reversionary income stream (ICR) for Beverley effective 12 March 2019. No reporting is required for Don.
Beverley's income stream is then rolled over to a different fund on 20 April 2019, Fund A reports a member commutation (MCO), and Fund B reports a child death benefit income stream (ICB).
End of example
Example 5: – suspended income stream which is then re-started
In example 4, Beverley is being paid a child death benefit income stream from 20 April 2019. Due to the fund rules and Beverley's unique circumstances, the income stream is suspended on 23 August 2019. The fund will report a stopped income stream (STO) effective 23 August 2019 using the value of the income stream immediately before it was suspended. On 23 December 2019 Beverley's income stream starts again. The fund reports a new income stream (SIS) effective 23 August 2019 using the value of the income stream on that date.
End of exampleFor more information, see Transfer balance account debits and credits.
Reporting retirement phase events for deceased members
An individual’s transfer balance account ceases on their death. There are no transfer balance cap reporting requirements for a deceased member for transactions that occur with an effective date after the date of death. However, if an event that occurred before the date of death hasn't been reported, this still needs to be reported. For example, if a super income stream commences and the member dies before it is reported, it must be reported.
Example 6: member starts an income stream and dies prior to fund reporting
Denise Black starts an income stream with her fund on 2 September 2019 and dies on 9 September 2019. Her income stream is auto reversionary and reverts to her husband Tom on 9 September 2019. The fund had not yet reported for Denise at the time of her death but does so on or before 16 September 2019. The fund reports the income stream (SIS) effective 2 September 2019 and does not report anything further for Denise. The fund then reports a reversionary income stream (IRS) for Tom effective 9 September 2019 and does so on or before 23 September 2019.
End of example
Example 7: member starts a new income stream and rolls over to a new fund
From example 6, Denise starts her income stream with Fund A on 2 September 2019 and rolls it over to Fund B on 5 September 2019. Denise dies on 9 September 2019 before either fund has reported. Being a reversionary income stream, which is paid automatically to Tom, it reverts to Tom in Fund B on 9 September 2019.
Fund A reports an income stream for Denise effective 2 September 2019 and a member commutation (MCO) for Denise effective 5 September 2019. Fund B reports an income stream for Denise effective 5 September 2019 and nothing further for Denise. Fund B then reports a reversionary income stream (IRS) for Tom effective 9 September 2019.
End of example