11Asset‑test exempt income stream resulting from Family Court order or injunction

11 Asset‑test exempt income stream resulting from Family Court order or injunction

These Principles cover an asset‑test exempt income stream if: (a) it is covered by section 5JA or 5JB of the Act; 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 2004; 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 5JA or 5JB of the Act; 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 covered by the 2007 Principles during the period starting on 20 September 2007 and ending at the end of 24 November 2011; or (iv) until the commencement of these Principles, was covered by the 2011 Principles; or (v) was covered by these Principles.

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. As it was purchased before 20 September 2004, the income stream has a 100% exemption from the assets test under the Act. At the time of the purchase, J and H are partnered. On 1 February 2023, J and H separate. On 15 February 2023, 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 5JA(1) of the Act. The new income stream is covered by these Principles and retains the 100% exemption from the assets test under the Act.