Income Tax Assessment (1997 Act) Regulations 2021

SCHEDULES

SCHEDULE 1AA  

Note: See subsection 293-115.20(2) .

WORKING OUT DEFINED BENEFIT CONTRIBUTIONS

PART 2 - NEW ENTRANT RATE  

6   New entrant rate to be based on period of membership needed to reach maximum benefit accrual  

6(1)    
If the rules of the defined benefit fund applicable to the benefit category provide for a maximum benefit accrual, the new entrant rate is to be calculated on the basis that the benefit is funded over the period to when maximum accrual is attained.

Note:

This means that, for the purpose of calculating the present value of future salaries payable to the new entrant, the superannuation salary is to be assumed to be zero at those ages after reaching maximum benefit accrual.

Example:

If maximum accrual is attained after 20 years of membership, the superannuation salary for a 30-year-old new entrant will be assumed to be zero at age 50 and above for the purpose of calculating the present value of future salaries payable to the new entrant.

6(2)    
For the Governor-General Pension Scheme, the period to when maximum benefit accrual is attained for a member of the Scheme is taken to be the period:

(a)    starting on the day the member ' s appointment as Governor-General starts; and

(b)    ending at the end of the financial year in which the member ' s appointment as Governor-General started.