This can benefit people who:

  • have a grandfathered account based pension where the assessable income from the pension exceeds the deemed income on an equivalent amount.

Potential Benefits:

  • May increase entitlement to pensions or allowances under the income test where deeming results in less assessable income than the income assessment for grandfathered account based pensions
  • May reduce aged care fees due to reduction in assessable income

Things to be aware of:

  • The income test assessment of a grandfathered account based pension is: “annual payment – deductible amount”
  • By rolling over a grandfathered account based pension to a new account based pension, the income stream will be deemed under the income test
  • In some cases deeming may produce less assessable income than “annual payment – deductible amount”
  • Deeming rates may increase over time.

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Disclaimer and Warning
The information above is of a general nature only. It should not be used as a source to make financial decisions. It’s also important to note that the legislation and figures related to this topic tend to change regularly and therefore the information above may not reflect the current status. We recommend that if you are looking for advice on this matter, you should contact us.