A complying defined benefit pension is a non-commutable income stream. Generally, a member cannot commute a non-commutable income stream and pay out the benefits as a lump sum. There are limited instances when a member can commute a complying defined benefit pension and one such occasion is when the proceeds are used to commence another complying income stream.
There are only two types of complying income streams now available to members wishing to commute their complying defined benefit pensions. The two complying income streams are:
This information sheet we discuss the options available to members (and their advisers) who have a complying defined benefit pension in their SMSF and find they are required to change this arrangement.
John is receiving a complying lifetime pension and his pension has failed the high probability test this year. John wishes to find out the options available to him and how each option will affect their retirement lifestyle
Karen is receiving a 15 year complying life-expectancy pension that will cease on 31 December 2017. Karen wishes to find out the options available to her and how each option will affect their retirement lifestyle.
The information on this page is provided by Accurium Pty Limited ABN 13 009 492 219 (Accurium). It is factual information only and is not intended to be financial product advice, tax advice or legal advice and should not be relied upon as such. The information is general in nature and may omit detail that could be significant to your particular circumstances. While all care has been taken to ensure the information is correct at the time of publishing, superannuation and tax legislation can change from time to time and Accurium is not liable for any loss arising from reliance on this information, including reliance on information that is no longer current. Tax is only one consideration when making a financial decision. We recommend that you seek appropriate professional advice before making any financial decisions.