Legislation has been introduced which, if passed, will result in the deeming of account based income streams, but this is causing some confusion.
I’m not sure if you have published details before but I noticed in one of the major newspapers that new deeming rules start in the new year. This is the first I have heard of it and as I’m considering starting an account based pension, I’m a little concerned. Can you advise what the new rules will mean?
A. This was a measure from the superannuation reviews of April 2013, which we reported on at the time, and, if passed as legislation, will take effect from 1 January 2015, not 2014.
Anyone who takes out an account based income stream prior to this will be assessed under the existing rules, unless they choose to change products after 1 January 2015, then the new income stream will be subject to deeming.
For a better understanding of deeming rules and rates, read Changes to deeming rules.
You can find out more about the proposed legislation by visiting HumanServices.gov.au.