Commonwealth Consolidated Acts

SUPERANNUATION ACT 1976 - SECT 146G

Election

  (1)   If:

  (a)   a person (the deceased person ) dies; and

  (b)   either:

  (i)   the deceased person is not survived by a spouse but is survived by a child or children of the deceased person; or

  (ii)   the deceased person is survived by a spouse, the spouse dies, and the spouse is survived by a child or children of the deceased person; and

  (c)   an orphan pension is payable in respect of the child or children (whether or not by virtue of section   136); and

  (d)   an assessment is made of the surcharge on the deceased person's surchargeable contributions for a financial year; and

  (e)   the person to whom the pension is payable (the eligible person ) (who may be the child or one of the children) becomes liable to pay the surcharge under the assessment in accordance with paragraph   10(4)(ca) of the Superannuation Contributions Tax (Assessment and Collection) Act 1997 ;

the eligible person may, within 3 months after the assessment was made, give CSC a written notice electing to commute the whole or a part of the orphan pension to a lump sum benefit equal to the amount specified in the election.

  (2)   The election must be accompanied by:

  (a)   a written notice requesting that the amount of the lump sum benefit be:

  (i)   paid to the Commissioner of Taxation; and

  (ii)   wholly applied in payment of surcharge under the assessment; and

  (b)   a copy of the notice of assessment.

Surcharge commutation amount

  (3)   The amount specified in the election:

  (a)   must be equal to or less than the amount of the surcharge under the assessment; and

  (b)   must not have the effect of reducing the pension below zero; and

  (c)   is to be known as the surcharge commutation amount for the purposes of this section.

Entitlement to lump sum benefit

  (4)   If an eligible person makes an election under subsection   (1) in relation to a pension, the eligible person is entitled to a lump sum benefit equal to the surcharge commutation amount.

  (5)   If an eligible person is entitled to a lump sum benefit under subsection   (4), the liability to pay that benefit must be discharged by:

  (a)   paying the amount of that benefit to the Commissioner of Taxation in accordance with the eligible person's request; and

  (b)   informing the Commissioner of Taxation of the eligible person's request that the amount be wholly applied in payment of surcharge under the assessment concerned.

Reduction of pension

  (6)   If an eligible person makes an election under subsection   (1) in relation to a pension, the annual rate of the pension is to be reduced in accordance with the method determined by CSC under section   146H. The reduction takes effect from the beginning of the day of the election.

One election per assessment

  (7)   An eligible person is not entitled to make more than one election under subsection   (1) in relation to a particular assessment.

Elections made before the first pension pay day

  (8)   If an election under subsection   (1) is made during the period:

  (a)   beginning on 1   January or 1   July in a year; and

  (b)   ending at the end of the first pension pay day after that 1   January or 1   July;

this section has effect as if the election had been made on the first day after that pension pay day.

Part of orphan pension

  (9)   To avoid doubt, if an orphan pension is apportioned under subsection   115(2), this section has effect, in relation to the portion applicable to a particular child or to particular children, as if a reference to the orphan pension were a reference to that portion.