12Guidelines for asset‑test exempt income stream resulting from Family Court order or injunction

12 Guidelines for asset‑test exempt income stream resulting from Family Court order or injunction

The Secretary may determine that an income stream is an asset‑test exempt income stream for the purposes of the Act if: (a) it is covered by section 9A or 9B of the Act or would have been covered by those sections if paragraph 9A(1)(aa) or subparagraph 9B(1)(a)(i) of the Act did not apply; and (b) it is purchased or acquired by the primary beneficiary or the primary beneficiary’s partner or former partner on or after 20 September 2007; and (c) it results from another asset‑test exempt income stream (the original income stream) being commuted to give effect to: (i) an order made under section 79, 90SM, 90SS or 114 of the Family Law Act 1975; or (ii) an injunction granted under section 90SS or 114 of that Act that is binding on a third party under Part VIIIAA of that Act; or (iii) any other order or injunction under the Family Law Act 1975 that relates specifically to the original income stream; and (d) the original income stream was covered by section 9A or 9B of the Act or would have been covered by those sections if paragraph 9A(1)(aa) or subparagraph 9B(1)(a)(i) of the Act did not apply; and (e) the original income stream: (i) was purchased before 20 September 2004; or (ii) was covered by the 2005 Principles during the period starting on 20 September 2004 and ending at the end of 19 September 2007; or (iii) was, until the commencement of this Determination, covered by the 2007 Determination; or (iv) is covered by this Determination.

Note: Example

Note: On 1 March 2002, J purchased an income stream (the original income stream) covered by subsection 9A(1) of the Act for the benefit of J, the primary beneficiary, and H, the reversionary beneficiary. As it was purchased before 20 September 2004, the income stream has a 100% exemption from the social security assets test. At the time of the purchase, J and H are partnered. On 1 February 2012, J and H separate. On 15 February 2012, J commutes the original income stream in response to a Family Court order and purchases another income stream (the new income stream) covered by subsection 9A(1) of the Act. The new income stream is covered by this Determination and retains the 100% exemption from the social security assets test.