Private ruling: Undeducted purchase price of a foreign pension or annuity
Date of advice: 20 October 2020
Published: November 2020
Ruling period: Income year ended 30 June 2020.
Date scheme commenced: 1 July 2019.

Ruling: Q1: Are you entitled to an undeducted purchase price (UPP) deductible amount in respect of your foreign pension? | A1: Yes. The deductible amount has been calculated in accordance with the formula under subsection 27H(2) of the Income Tax Assessment Act 1936

Relevant facts and circumstances: · The taxpayer is a resident of Australia for income tax purposes. · The taxpayer's pension is paid by a pension scheme maintained in Switzerland. · The taxpayer has provided a copy of a letter from their pension scheme outlining the amount of their personal contributions. · The taxpayer commenced their pension on 1 July 2011 and is payable for life. · The taxpayer currently receives 100% of the pension. · The residual capital value of the taxpayer's pension is nil. · The taxpayer was 64 years of age when they commenced the pension. · The taxpayer's pension is paid on a monthly basis.

Relevant legislative provisions: Income Tax Assessment Act 1936 Section 27H | Income Tax Assessment Act 1936 Subsection 27H(2) | Income Tax Assessment Act 1936 Subsection 27H(4) | Income Tax Regulations 1936 Regulation 9