Following the death of a member of a superannuation fund or approved deposit fund, a payment can be made to a beneficiary or to the trustee of a deceased estate. The payment can be made as a superannuation lump sum, or to dependants of the member, as a superannuation income stream.
Currently the deduction under section 295-485 (the anti-detriment deduction) generally entitles complying superannuation funds and complying approved deposit funds to an income tax deduction when they provide a lump sum benefit because of the death of a member for the benefit of their spouse, former spouse or children.
For processing in Simple Fund 360 refer to Anti-Detriment Payments and Deductions.
The amendments remove the anti-detriment deduction from the income tax law.
Overview
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New law
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Current law
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| Complying superannuation funds and complying approved deposit funds are not entitled to claim an income tax deduction if they pay a superannuation benefit on the death of a member to benefit their spouse, former spouse or children and this benefit is greater than it would otherwise be to compensate for income tax paid by the fund in respect of contributions made during the member’s lifetime. The equivalent deduction for life insurers is also no longer available. | Complying superannuation funds and complying approved deposit funds are entitled to claim an income tax deduction if they pay a superannuation benefit on the death of a member to benefit their spouse, former spouse or child and this benefit is greater than it would otherwise be to compensate for income tax paid by the fund in respect of contributions made during the member’s lifetime. An equivalent deduction is available for lump sum death benefits paid by life insurers in respect of exempt life insurance policies (within the meaning of section 320-246) and certain other life insurance policies relating to superannuation (see section 320-107). |
Changes to Simple Fund 360
Currently no changes are planned for Simple Fund 360.