Social Security (Value of Asset-tested Income Streams (Lifetime)) Determination 2019
5Surrender value method
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5 Surrender value method
(1) This section sets out a method for working out the value of an asset‑tested income stream (lifetime) by reference to the surrender value of the income stream. (2) The value of a person’s asset‑tested income stream (lifetime) on a particular day is the highest value for that day or any later day worked out using the following method statement.
Method statement
Step 1. Determine the surrender value of the asset‑tested income stream (lifetime) for the day.
Step 2. Compare the surrender value with the surrender comparison value of the income stream for the day (see subsection (3)).
Step 3. The value of the income stream for the day is:
(a) if the surrender value is more than the surrender comparison value and the income stream is not a joint income stream—the surrender value; or
(b) if the surrender value is more than the surrender comparison value and the income stream is a joint income stream—the surrender value multiplied by the proportion of the income stream attributable to the person on that day; or
(c) if the surrender value is less than or equal to the surrender comparison value—nil.
(3) The surrender comparison value of an asset‑tested income stream (lifetime) is: (a) for a day during the 14 day period that begins on the assessment day for the income stream—the access amount for the day; (b) for any other day: (i) unless subparagraph (ii) applies—the amount worked out for the day under subsection (4); or (ii) if the amount worked out for the day under subsection (4) is less than or equal to zero—nil. (4) For the purposes of paragraph (3)(b), the amount for a day (the access day) is worked out using the following formula: Start formula start open bracket start fraction Access amount for the income stream for the access day over Life expectancy period for the income stream end fraction times Remaining life expectancy end open bracket minus Previously commuted amount end formula where:
previously commuted amount means the sum of any amounts commuted from the income stream before the access day.
remaining life expectancy means the number of days remaining in the life expectancy period for the income stream after subtracting the number of days in the period:
(a) starting on the assessment day for the income stream; and
(b) ending on the access day.