8Guidelines for asset‑test exempt income stream resulting from original asset‑test exempt income stream purchased before 20 September 2004

8 Guidelines for asset‑test exempt income stream resulting from original asset‑test exempt income stream purchased before 20 September 2004

(1) The Commission may determine that an income stream is an asset‑test exempt income stream for the purposes of the Act if: (a) the income stream (the present income stream) would have been covered by sections 5JA(1) or 5JB(1) of the Act, if: (i) paragraph 5JA(1)(aa); or (ii) subparagraph 5JB(1)(a)(i); of the Act did not apply; and (b) it is purchased by the primary beneficiary on or after 20 September 2007 from funds arising from the commutation of another asset‑test exempt income stream (the original income stream); and (c) the original income stream was purchased before 20 September 2004; and (d) the original income stream is a kind of income stream to which one of the following subsections applies. (2) This subsection applies to an original income stream if: (a) it is covered by subsection 5JA(1) or (1A) or section 5JB of the Act; and (b) it was purchased by the primary beneficiary for the benefit of the primary beneficiary and a reversionary beneficiary; and (c) payments made under the income stream are calculated on the basis of the life expectancy of the reversionary beneficiary; and (d) the reversionary beneficiary predeceases the primary beneficiary. (3) This subsection applies to an original income stream if: (a) it is covered by subsection 5JA(1) or (1A) or section 5JB of the Act; and (b) it is not an income stream to which section 11 or 12 of this Determination applies; and (c) it is purchased by the primary beneficiary for the benefit of the primary beneficiary and a reversionary beneficiary who, at the time of the purchase, are members of a couple together; and (d) the primary beneficiary and reversionary beneficiary are no longer members of a couple together.

Note: Example

Note: On 1 March 2002, J purchased an income stream (the original income stream) covered by subsection 5JA(1) of the Act for the benefit of J, the primary beneficiary, and H, the reversionary beneficiary. At the time of the purchase, J and H were members of a couple together. On 1 June 2022, J and H ceased to be members of a couple together. On 15 June 2022, J commutes the original income stream and purchases another income stream (the new income stream). The new income stream is covered by this Determination and retains the 100% exemption from the assets test under the Act.

(4) This subsection applies to an original income stream if: (a) it is a defined benefit pension covered by section 5JA or 5JB of the Act that is provided by a regulated superannuation fund; and (b) it is an income stream in relation to which the Commission is not satisfied as required by paragraph 5JA(1)(b) or 5JB(1A)(b) of the Act.