Annuity conditions

Item

Column 1

The condition in column 2 applies in the following circumstances ...

Column 2

The condition is that ...

1

there is a residual capital value (within the meaning of section 27A of the Income Tax Assessment Act 1936) in relation to the *immediate annuity.

the contract under which the annuity is payable does not permit the residual capital value to exceed the annuity's purchase price (within the meaning of that section).

2

the contract under which the *immediate annuity is payable provides that the annuity is payable until the end of a term of years certain.

the contract does not permit the total of the amounts paid for the annuity's commutation (whether in whole or in part) to exceed the annuity's reduced purchase price (within the meaning of that section).

3

the contract under which the *immediate annuity is payable:

(a) provides that the annuity is payable until the later of:

(i) the death of a person (or the death of the last of 2 or more persons to die); or

(ii) the end of a term of years certain; and

(b) permits one or more amounts ( commutation payments ) to become payable before the end of the term of years certain for the annuity's commutation (whether in whole or in part).

the contract does not permit the total of the commutation payments that may become payable before the end of the term of years certain to exceed the annuity's reduced purchase price (within the meaning of that section).

4

all circumstances.

there is no unreasonable deferral of the payments of the *immediate annuity, having regard to:

(a) to the extent to which the payments depend on the returns of the investment of the assets of the *life insurance company paying the annuity - when the payments are made and when those returns are *derived; and

(b) to the extent to which the payments do not depend on those returns - the relative sizes of the annual totals of the payments from year to year; and

(c) any other relevant factors.