15When surcharge will become payable

15 When surcharge will become payable

Explanation of section (1) This section makes provision for the deferment of the liability of a member of a constitutionally protected superannuation fund to pay surcharge, and for interest to accrue on the deferred amount. Accounts to be kept (2) The Commissioner is to keep a surcharge debt account for each member of a constitutionally protected superannuation fund. Account to be debited for surcharge (3) The Commissioner is to debit the account for surcharge assessed to be payable on the member’s surchargeable contributions. Interest to be debited (4) If the member’s account is in debit at the end of a financial year, the Commissioner is to debit the account for interest on the amount by which the account is in debit, calculated at the Treasury bond rate for the last day of the financial year for bonds with a 10 year term. Rate of interest (5) The Treasury bond rate for the last day of a financial year for bonds with a 10 year term is: (a) if any Treasury bonds with that term were issued on that day—the annual yield on those bonds; or (b) otherwise—the annual yield on Treasury bonds with that term, as published by the Reserve Bank of Australia for that day. Payment to be made when benefit becomes payable (6) Subject to subsection (6AA), when a superannuation benefit (within the meaning of the Income Tax Assessment Act 1997) becomes payable by a superannuation provider for the benefit of a member whose surcharge debt account is in debit, the member is liable to pay to the Commissioner the lesser of: (a) the amount by which the account is in debit; or (b) the total of the following amounts: (i) 15% of the employer‑financed component of any part of the benefits payable to the member that accrued between 20 August 1996 and 1 July 2003; (ii) 14.5% of the employer‑financed component of any part of the benefits payable to the member that accrued in the 2003‑2004 financial year; (iii) 12.5% of the employer‑financed component of any part of the benefits payable to the member that accrued in the 2004‑2005 financial year. (6AA) If: (a) a payment split applies to a splittable payment in respect of an interest that a person has as a member; and (b) the splittable payment becomes payable in circumstances where the member’s surcharge account is in debit; then the member is liable to pay to the Commissioner the lesser of: (c) the amount by which the account is in debit; and (d) the total of the following amounts: (i) 15% of the employer‑financed component of any part of the benefits that would have been payable to the member but for the payment split and that accrued between 20 August 1996 and 1 July 2003; (ii) 14.5% of the employer‑financed component of any part of the benefits that would have been payable to the member but for the payment split and that accrued in the 2003‑2004 financial year; (iii) 12.5% of the employer‑financed component of any part of the benefits that would have been payable to the member but for the payment split and that accrued in the 2004‑2005 financial year. Payment to be made if fund ceases to be a constitutionally protected superannuation fund (6A) If a superannuation fund ceases to be a constitutionally protected superannuation fund at a time when a member’s surcharge debt account is in debit, the member is liable to pay to the Commissioner the lesser of: (a) the amount by which the account is in debit; or (b) the total of the following amounts: (i) 15% of the employer‑financed component of any part of the value of the age retirement benefits of the member when the fund ceased to be a constitutionally protected superannuation fund that accrued between 20 August 1996 and 1 July 2003; (ii) 14.5% of the employer‑financed component of any part of the value of the age retirement benefits of the member when the fund ceased to be a constitutionally protected superannuation fund that accrued in the 2003‑2004 financial year; (iii) 12.5% of the employer‑financed component of any part of the value of the age retirement benefits of the member when the fund ceased to be a constitutionally protected superannuation fund that accrued in the 2004‑2005 financial year. (7) If a member becomes liable to pay an amount to the Commissioner under subsection (6), (6AA) or (6A), the Commissioner must give the member a notice stating that the member is liable to pay the amount. The notice must contain the date on which it is issued. (8) The amount is payable within 3 months after the date of issue of the notice and the notice is to state that the amount is so payable. Payment of the amount results in a nil balance in the account.