Weekly Tax Bulletin --- Page: 2077 : 8 December 2006 Original article by Stuart Jones
ABIX Summary
There are new regulations on superannuation death benefit payments in Australia. A lump sum death benefit payment will be free of tax if it is paid to a "dependent". For tax purposes, tax law defines a "dependent" carefully - it can be a spouse, including a de facto of the opposite sex, a child of the member (under 18 for tax purposes), a person who is in an interdependency relationship with the member and a person who is financially dependent on the member. The taxation of a death benefit paid as a reversionary pension will be dependent on age. The benefit will be tax-free if the reversionary beneficiary is aged 60 or over. It will no longer be possible to revert a pension to a non-dependent on death; they must get a lump sum.
