The Albanese Government is taking further steps to improve the efficiency of the superannuation system.
The Government is progressing legislative amendments to the transfer balance cap for individuals with a capped defined benefit income stream to ensure members are not adversely impacted in the event of a merger or successor fund transfer between superannuation funds.
Under current legislation, a member’s cap may be unintentionally impacted due to the original income stream being treated as ceasing and a new one beginning.
This means a new valuation of the capped defined benefit income stream is required which can result in a higher valuation for the transfer balance cap and lead to adverse outcomes for some members.
The Government will ensure that members receiving an income stream prior to a merger or successor fund transfer will continue to receive their income stream without unintentionally impacting the transfer balance cap.
The amendments will apply retrospectively from 1 July 2017.
