See Ed note, below. This is a huge hit on folks with between $600k and $1m as it WILL impact the Age Pension. And it got almost zero news today - newspaper analysts - who'd have them :-) -----------------------------------------------
Extending the normal deeming rules to superannuation account-based income streams The Government will extend the normal deeming rules to superannuation account-based income streams for the purposes of the pension income test to ensure all financial investments are assessed fairly and under the same rules.
Standard pension deeming arrangements will apply to new superannuation account-based income streams assessed under the pension income te t rules after 1 January 2015.
All products held by pensioners before 1 January 2015 will be grandfathered indefinitely and continue to be assessed under the existing rules for the life of the product so no current pensioner will be affected, unless they choose to change products.
Ed Note: This is a surprising and nasty inclusion and one that will not be warmly welcomed by the industry. If this legislation is enacted it takes away another reason why superannuation is considered the better savings vehicle for retirement. With the income test concession removed from pensions what reason would retirees have to keep money in super, particularly if they are already on a low marginal tax rate. It would be plausible to reduce the asset test threshold but to propose this change to the income test is beyond belief
