Income Tax Assessment Regulations 1997 (Repealed)

SCHEDULE 1A  

(subregulations 292-170.02(2) , 292-170.05(2) and (3) and 292-170.06(2) and (3))

METHOD OF WORKING OUT AMOUNT OF NOTIONAL TAXED CONTRIBUTIONS

PART 2 - NEW ENTRANT RATE  

2.1   Method of working out new entrant rate for a benefit category  

2.1(1)    
The new entrant rate for a benefit category is the rate calculated under this Part and using the assumptions set out in Part 3.

2.1(2)    
The new entrant rate for a benefit category is the rate that represents the long-term cost, expressed as a percentage of superannuation salary, of providing as much of the fund benefit as is payable on a voluntary exit to a hypothetical new entrant to the benefit category.

2.1(3)    
The new entrant rate is calculated as the present value of the fund benefit payable on voluntary exit (resignation, early retirement, or retirement) under the rules of the defined benefit fund which are applicable to a new entrant to the benefit category divided by the present value of future superannuation salaries payable to the new entrant.

2.1(4)    
To put the matter beyond doubt, the new entrant rate is calculated assuming that the fund benefit is to be wholly sourced from concessional contributions made into the fund at the new entrant rate and earnings on those contributions.

2.1(5)    
The present value of the fund benefit is to be calculated having regard to the rules and practice of the defined benefit fund including benefit structure, caps, member options, reasonably expected discretions and member contributions, and using the economic, decrement and other assumptions set out in Part 3.