Private ruling: Superannuation fund for foreign residents - withholding tax exemption
Date of advice: 15 August 2024
Published: 23 September 2024
Ruling period: 1 July 20XX to 30 June 20XX
Date scheme commenced: XX August 20XX

Ruling: Q1: Is the Fund excluded from liability to withholding tax on its interest, dividend and non-share dividend income derived from its Australian investments which were acquired after 27 March 2018 under paragraph 128B(3)(jb) of the Income Tax Assessment Act 1936 ITAA 1936? | A1: Yes.

Relevant facts and circumstances: Background Plans Plan 1 Eligibility Contributions Retirement Benefits Disability Benefits Survivors Benefits Plan 2 Eligibility Contributions Retirement Benefits Disability Benefits Survivors Benefits Termination Plan 3 Eligibility Contributions Retirement Benefits Disability Benefits Survivors Benefits Termination Rollover payments to eligible retirement plan Other Information The Fund provided a letter to the Commissioner stating: a. The entity is an indefinitely continuing fund and a provident, benefit, superannuation or retirement fund; b. The entity was established in a foreign country; c. The entity was established, and is maintained, only to provide benefits for individuals who are not Australian residents; d. The central management and control of the entity is carried on outside Australia by entities none of whom is an Australian resident; e. An amount paid to the entity or set aside for the entity has not been or cannot be deducted under the ITAA 1997; and f. A tax offset has not been allowed or is not allowable for such an amount. g. The income of the Fund is not non-assessable non-exempt income of the Fund because of: i. Subdivision 880-C of the ITAA 1997; or, ii. Division 880 of the Income Tax (Transitional Provisions) Act 1997 Appendix - Australian Investments a. The equity investments are listed on the ASX b. The Fund holds less than 10% of the total equity interests on issue of the Australian companies in which it invests c. The Fund has no involvement in the day to day management of the business of the Australian companies d. The Fund has no right to appoint a director to the Board of Directors of the Australian companies e. The Fund has no right to representation on any investor representative or advisory committee (or similar) of the Australian companies f. The Fund has no ability to direct or influence the operation of the Australian companies outside of the ordinary rights conferred by the equity interests held g. The Fund does not have the ability to direct or influence the operation of the company or otherwise provide the Fund with anything that would constitute influence under subsection 128B(3CD) of the ITAA 1936.

Relevant legislative provisions: Income Tax Assessment Act 1936 Paragraph 128B(3)(jb) | Income Tax Assessment Act 1936 Section 128D | Income Tax Assessment Act 1997 Section 118-520

Reasons for decision: Summary: Section 128B of the ITAA 1936 imposes liability to withholding tax on income derived by a non-resident that consists of dividend income (subsection 128B(1) of the ITAA 1936), interest income (subsection 128B(2) of the ITAA 1936) as well as other income prescribed in that section. Subsection 128B(3) of the ITAA 1936 notes that section 128B of the ITAA 1936 will not apply to prescribed categories of income. Relevantly, paragraph 128B(3)(jb) provides an exclusion from withholding tax for interest, dividends and non-share dividends derived by a superannuation fund for foreign residents (subject to the satisfaction of certain conditions). For the exclusion to apply, the interest, dividend and/or non-share dividend income must be: • derived by a superannuation fund for foreign residents (as defined in section 118-520 of the ITAA 1997), and • exempt from income tax in the country in which the superannuation fund for foreign residents arise. | Detailed Reasoning - The Participating Plans are non-residents: Each of the ParticipatingPlans is not a resident of Australia. Therefore, the ParticipatingPlans satisfy this requirement. | Detailed Reasoning - The Participating Plans are a superannuation fund for foreign residents: Superannuation fund for foreign residents is a defined term in the ITAA 1936. Subsection 6(1) of the ITAA 1936 states: superannuation fund for foreign residents has the meaning given by subsection 995-1(1) of the Income Tax Assessment Act 1997. Subsection 995-1(1) of the ITAA 1997 sets out the following: superannuation fund for foreign residents has the meaning given by section 118-520. The term 'superannuation fund for foreign residents' is defined in section 118-520 of the Income Tax Assessment Act 1997 (ITAA 1997) as follows: | Detailed Reasoning - 118-520 Meaning of superannuation fund for foreign residents: (1) A fund is a superannuation fund for foreign residents at a time if: (a) at that time, it is: (i) an indefinitely continuing fund; and (ii) a provident, benefit, superannuation or retirement fund; and (b) it was established in a foreign country; and (c) it was established, and is maintained at that time, only to provide benefits for individuals who are not Australian residents; and (d) at that time, its central management and control is carried on outside Australia by entities none of whom is an Australian resident. (2) However, a fund is not a superannuation fund for foreign residents if: (a) an amount paid to the fund or set aside for the fund has been or can be deducted under this Act; or (b) a *tax offset has been allowed or is allowable for such an amount. Consequently, for the ParticipatingPlans to be considered a superannuation fund for foreign residents for the purposes of paragraph 128B(3)(jb) of the ITAA 1936, it must be established that: | Detailed Reasoning - The Participating Plans are indefinitely continuing funds: The term 'indefinitely continuing fund' is not defined in either the ITAA 1997 or the ITAA 1936. Therefore, it should be given its ordinary meaning subject to the context in which it appears and having regard to any relevant case law authorities. The Australian Oxford Dictionary , 2004, Oxford University Press, Melbourne defines the term 'fund' as 1 a permanent stock of something ready to be drawn upon... 2 a stock of money, especially one set apart for a purpose. In Scott v. FC of T (No 2) (1966) 14 ATD 333; (1966) 10 AITR 290 (Scott) , Windeyer J expressed the view that 'fund' in the context of 'superannuation fund' ordinarily meant 'money (or investments) set aside and invested, the surplus income therefrom being capitalised'. Windeyer J's views in Scott were cited with approval by Hill J in Walstern Pty Ltd v. Commissioner of Taxation (2003) 138 FCR 1; 2003 ATC 5076; (2003) 54 ATR 423 who stated that 'for present purposes, the point is the need for "money" or "other property" to constitute a fund'. The general view is that an indefinitely continuing fund does not have to continue forever, but rather that the governing rules should not fix an express termination date. The governing rules of each of the Participating Plans do not fix an express termination date and show no evidence of a contemplated end date. Therefore, the ParticipatingPlans satisfy his requirement. | Detailed Reasoning - The Participating Plans are a provident, benefit, superannuation or retirement fund: The phrase 'a provident, benefit, superannuation or retirement fund' under paragraph 118-520(1)(a)(ii) is not defined in either the ITAA 1997 or the ITAA 1936. However, the phrase has been subject to judicial consideration. In Scott , the High Court examined the terms 'superannuation fund' and 'fund'. Justice Windeyer stated at ATD 351; AITR 312; ALJR 278 that: ... I have come to the conclusion that there is no essential single attribute of a superannuation fund established for the benefit of employees except that it must be a fund bona fide devoted as its sole purpose to providing for employees who are participants money benefits (or benefits having a monetary value) upon their reaching a prescribed age. In this connexion "fund", I take it, ordinarily means money (or investments) set aside and invested, the surplus income there from being capitalised. In a later case, Mahoney v. Commissioner of Taxation (Cth) (1967) 41 ALJR 232; (1967); 14 ATD 519; 10 AITR 463 (Mahoney case), the High Court took a similar view as in Scott, Justice Kitto expressed the view at ALJR 232; (1967); ATD 520; AITR 464 that: All that need be recognised is that just as 'provident' and 'superannuation' both referred to the provision of a particular kind of benefit - in the one case a provision against contemplated contingencies, and in the other case a provision, to arise on an employee's retirement or death or other cessation of employee, of a subvention for him or his estate or persons towards whom he may have stood in some kind of relation commonly giving rise to a legal or moral responsibility - so 'benefit' must have meant a benefit, not a general sense, but characterised by some specific future purpose. The court found that the expression takes its meaning from past usage and the meaning of the several expressions must be arrived at in light of their ordinary usage. As such, the term 'benefit' requires a purpose narrower than conferring benefits in a completely general sense. The benefit must be characterised by some future purpose. Likewise, a provident fund must not refer to the provision of funds in a general sense but must relate to a provision against contemplated contingencies. Both of the above mentioned cases emphasise that the benefits must be provided for a specific purpose and require that there is a connection between the benefit received and the provision by the fund for retirement or death of a member or against 'contemplated contingencies', such as death, disability or serious illness. Each of the ParticipatingPlans provide retirement benefits, death benefits and disability payments for eligible members. Benefits are only accessible by members when they meet select criteria, being calculated based on the member's age and years of service. Therefore, the ParticipatingPlans will satisfy this requirement. | Detailed Reasoning - The Participating Plans were established in a foreign country: The ParticipatingPlans were established in a foreign country. Therefore, the ParticipatingPlans satisfy this requirement. | Detailed Reasoning - The Participating Plans were established and maintained only to provide benefits for individuals who are not Australian residents: The Participating Plans were established and are maintained only to provide benefits to members who are employees of the Company or participating employers, all based in a foreign country. It is considered that the possibility of a very small number of members being returned residents or becoming Australian residents after ceasing eligible employment is incidental and should not be taken to conclude that the Participating Plans, in this case, have not been established and are not maintained only to provide benefits for non-residents, based on the rules and operation of the Pension Plans. Therefore, the Participating Plans satisfy this requirement. | Detailed Reasoning - The Participating Plan's central management and control is carried on outside Australia by entities none of whom is an Australian resident: Paragraphs 20 and 21 of Taxation Ruling TR 2008/9 Income tax: meaning of 'Australian superannuation fund' in subsection 295-95(2) of the Income Tax Assessment Act 1997 (TR 2008/9) states in respect of the central management and control (CM&C) of a superannuation fund: 20. The CM&C of a superannuation fund involves a focus on the who, when and where of the strategic and high level decision making processes and activities of the fund. In the context of the operations of a superannuation fund, the strategic and high level decision making processes includes: • formulating the investment strategy for the fund; • reviewing and updating or varying the fund's investment strategy as well as monitoring and reviewing the performance of the fund's investments; • if the fund has reserves - the formulation of a strategy for their prudential management; and • determining how the assets of the fund are to be used to fund member benefits. 21. The other principal areas of operation of a superannuation fund that form part of the day-to-day or operational side of the fund's activities will not constitute CM&C. These activities do not form part of the CM&C of the fund because they are not of a strategic or high level nature. Rather, these activities are of a more formalistic or administrative nature. Examples of such activities include the acceptance of contributions that are made on a regular basis, the actual investment of the fund's assets, the fulfilment of administrative duties and the preservation, payment and portability of benefits. Furthermore, paragraphs 10 and 11 of Taxation Ruling TR 2018/5 Income tax: central management and control test of residency (TR 2018/5) states: 10. Central management and control refers to the control and direction of a company's operations. It does not refer to a physical location in which the control and direction of a company is located and may ultimately be exercised in more than one location. 11. The key element in the control and direction of a company's operations is the making of high-level decisions that set the company's general policies and determine the direction of its operations and the type of transactions it will enter. The Fund and the Participating Plans are all based outside of Australia. The Fund exists for the benefit of members who are not Australian residents, and are employees of employers outside of Australia. Based on the above, it is reasonable to conclude that the central management and control of the Participating Plans occurs outside of Australia by entities that are not Australian residents. Therefore, the Participating Plans satisfy this requirement. No amount paid to the Fund/Participating Plans or set aside for the Fund/ Participating Plans has been or can be deducted under the ITAA 1997 and no tax offset has been allowed or is allowable for such an amount An amount paid to the Fund/Participating Plans or set aside for the Fund/Participating Plans has not been and cannot be deducted under the ITAA 1997. A tax offset has not been allowed nor would be allowable for any amount paid to the Fund/Participating Plans or set aside for the Fund/Participating Plans. Therefore, the Fund/Participating Plans will satisfy this requirement. | Detailed Reasoning - Conclusion: As all of the above requirements are satisfied, the Participating Plans meet the requirements of being a superannuation fund for foreign residents as defined by section 118-520 of the ITAA 1997 for the purposes of subparagraph 128B(3)(jb)(i) of the ITAA 1936. | Detailed Reasoning - The income, consisting of interest, dividend or non-share dividend income, is derived by the Fund: Paragraph 128B(3)(jb) of the ITAA 1936 will only apply to interest, or to dividends and non-share dividends paid by Australian resident companies to the Fund to which the Participating Plans are presently entitled. The Fund, with its presently entitled Participating Plan beneficiaries, will receive interest income from their Australian investments, along with dividend and non-share dividend income from companies who are residents of Australia for tax purposes. Therefore, the Participating Plans will satisfy this requirement. | Detailed Reasoning - Subparagraph 128B(3)(jb)(iii) of the ITAA 1936: The Participating Plans are exempt from taxation on the interest, dividend and non-share dividend paid by Australian companies in the foreign resident country in which the fund and plans reside for tax purposes. Therefore, the Participating Plans will satisfy this requirement. | Detailed Reasoning - Conclusion: As all the requirements of paragraph 128B(3)(jb) of the ITAA 1936 are satisfied, the Participating Plans will be entitled to an exemption from withholding tax on interest, dividend and non-share dividend income derived in respect of assets acquired on or before 27 March 2018 under paragraph 128B(3)(jb) of the ITAA 1936. | Detailed Reasoning - Treasury Laws Amendment (Making Sure Foreign Investors Pay Their Fair Share of Tax in Australia and Other Measures) Act 2019: The Treasury Laws Amendment (Making Sure Foreign Investors Pay Their Fair Share of Tax in Australia and Other Measures) Act 2019 introduced extra requirements that must be met for paragraph 128B(3)(jb) of the ITAA 1936 to apply from 1 July 2019 onwards. These extra requirements apply only to assets which were acquired after 27 March 2018. For the purposes of Question 2, which only considers the Pension Plan's assets acquired after 27 March 2018, these extra requirements are applicable. Relevantly: i. The Pension Plans must satisfy the 'portfolio interest test' in relation to the test entity (subsection 128B(3CC) ii. The Pension Plans must satisfy the 'influence test' (subsection 128B(3CD) in relation to the test entity, and iii. The income cannot otherwise be non-assessable non-exempt income of the Fund because of: a. Subdivision 880-C of the ITAA 1997, or b. Division 880 of the Income Tax (Transitional Provisions) Act 1997 . It has been established above that the Participating Plans have satisfied all of the pre-existing conditions of paragraph 128B(3)(jb) of the ITAA 1936. As such, the below analysis concentrates only on the extra requirements outlined above. | Detailed Reasoning - The Participating Plans satisfy the 'portfolio interest test': Subsection 128B(3CC) of the ITAA 1936 states: A superannuation fund satisfies the portfolio interest test in this subsection in relation to the test entity at a time if, at that time, the total participation interest (within the meaning of the Income Tax Assessment Act 1997 ) the superannuation fund holds in the test entity: (a) is less than 10%; and (b) would be less than 10% if, in working out the direct participation interest (within the meaning of that Act) that any entity holds in a company: (i) an equity holder were treated as a shareholder; and (ii) the total amount contributed to the company in respect of non-share equity interests were included in the total paid-up share capital of the company. In the case of the Participating Plans, the relevant 'test entities' are the entities listed in Appendix to the Relevant Facts and Circumstances of the Ruling. Subsection 128B(3CB) defines the test entity to be either the entity that paid the interest, dividends or non-share dividends or, if subsection 128A(3) of the ITAA 1936 applies in relation to a resident trust estate, that trust estate. Subsection 995-1(1) of the ITAA 1997 defines total participation interest to have the meaning given by section 960-180 of the ITAA 1997, which states: An entity's total participation interest at a particular time in another entity is the sum of: (a) the entity's *direct participation interest in the other entity at that time; and (b) the entity's *indirect participation interest in the other entity at that time. A 'direct participation interest' that the Fund will have in a test entity is defined in the table in subsection 960-190(1) of ITAA 1997 and depends on what type of entity the other entity is. Item 1 of the table in subsection 960-190(1) and subsection 960-190(2) of the ITAA 1997 provide that a direct participation interest in a company is the 'direct control interest' (within the meaning of section 350 of the ITAA 1936 excluding the operation of subsections 350(6) and (7)) that the first entity holds in the other entity. Subsection 350(1) of the ITAA 1936 provides that an entity holds a direct control interest in a company at a particular time equal to the percentage of: (a) total paid up share capital (b) voting rights, or (c) rights to distributions of capital or profits that it holds in the company. Where there are different percentages in each of the above, the direct control interest is the greater or greatest of those percentages. Subsection 350(2) of the ITAA 1936 provides that where an entity holds different percentages of total rights to vote for the purposes of (b) above, the highest of those percentages applies in establishing the direct control interest. Subsection 960-185(1) of the ITAA 1997 provides that an entity's indirect participation interest in a test entity is established by multiplying its direct participation interest in an intermediate entity by the sum of the intermediate entity's direct and indirect participation interests in the test entity. As per the facts of this ruling, the Fund holds less than 10% total participation interests in all of its Australian Investments, and holds no influence over the investment companies beyond those conferred by the equity interests held. All of the underlying Participating Plans therefore have an indirect participation interest in the Australian assets as defined in subsection 960-185(1) of the ITAA 1997 (as they hold the assets through their interest in the Fund). This means that the total participation interest of each of the underlying Participating Plans will be the Fund's participation interest in the Australian company or MIT multiplied by the Participating Plans' proportional interest in the Fund. The Participating Plans currently do not hold more than 10% ownership of any of the Australian companies or MITs listed in the Appendix. Further, the Participating Plans would hold less than 10% of the total participation interests in each Australian company or MIT listed in the Appendix in the circumstances detailed in paragraph 128B(3CC)(b) of the ITAA 1936. In these circumstances, the Commissioner is satisfied that the total participation interest the Fund holds in the test entities: The Participating Plans therefore satisfy the 'portfolio interest test' in respect of their current investments listed in the Appendix. The Participating Plans do not have influence of a kind described in subsection 128B(3CD) of the ITAA 1936 in relation to the test entity at the time the income was derived Subsection 128B(3CD) of the ITAA 1936 states: A superannuation fund has influence of a kind described in this subsection in relation to the test entity at a time if any of the following requirements are satisfied at that time: (a) the superannuation fund: (i) is directly or indirectly able to determine; or (ii) in acting in concert with others, is directly or indirectly able to determine; the identity of at least one of the persons who, individually or together with others, make (or might reasonably be expected to make) the decisions that comprise the control and direction of the test entity's operations; (b) at least one of those persons is accustomed or obliged to act, or might reasonably be expected to act, in accordance with the directions, instructions or wishes of the superannuation fund (whether those directions, instructions or wishes are expressed directly or indirectly, or through the superannuation fund acting in concert with others). As such, there are two distinct sub-tests within the influence test. Sub-test 1 of the influence test, as contained in paragraph 128B(3CD)(a) of the ITAA 1936, assesses whether the Pension Plans are able to determine the identity of at least one of the persons who, individually or together with others, makes or is reasonably expected to make, decisions comprising the control and direction of the test entity's operations. This includes situations where the Pension Plans are able to act in concert with others to determine the identity of a relevant decision-maker in the test entity. Sub-test 1 also extends to situations where the Pension Plans, in their own right, hold the ability to approve or veto decisions which go to the control or direction of the test entity. The Fund has no power over any of its Australian investments to appoint any person, either on its own or by pooling interests with other investors. The Fund has no ability to veto or otherwise director or influence the direction of these companies. Sub-test 2 of the influence test, as contained in paragraph 128B(3CD)(b) of the ITAA 1936, assesses whether at least one of the relevant decision-making persons of the test entity is accustomed or obliged to act, or might reasonably be expected to act, in accordance with the directions, instructions or wishes of the Participating Plans. There are no side letters to the Fund, or similar arrangements providing the fund with influence over the direction of the investment entities. Relevantly, in respect of the investments listed in the relevant facts and circumstances of this Ruling: Accordingly, the Participating Plans do not have influence of a kind described in subsection 128B(3CD) of the ITAA 1936 in respect of its Australian investments. The Participating Plans do not have capacity to influence (either directly or indirectly) the day-to-day management of the operations of their investments. Consequently, the Commissioner accepts that the Participating Plans do not have influence of a kind described in subsection 128B(3CD) of the ITAA 1936. The income received by the Fund/ Participating Plans is not non-assessable and non-exempt income of the Fund because of Subdivision 880-C of the ITAA 1997 or Division 880 of the Income Tax (Transitional Provisions) Act 1997 The income received by the Participating Plans will not be non-assessable non-exempt income because of Subdivision 880-C of the ITAA 1997 or Division 880 of the Income Tax (Transitional Provisions) Act 1997 . The Participating Plans therefore satisfy this condition in respect of its current investments listed in the Appendix. | Detailed Reasoning - Conclusion: As the Participating Plans have met both the pre-existing and extra requirements under paragraph 128B(3)(jb) of the ITAA 1936 in relation to assets it acquired after 27 March 2018, they will be excluded from withholding tax in relation to interest, dividend and non-share dividend income received in respect of those assets.

The Fund is a Group Trust resided in a Foreign Country. | The Fund is governed by a Trust Agreement. | The Tax Authority in the Fund's resident country have certified that the Fund is a qualified pension or retirement plan and is exempt from taxation in that country. | The Fund exists and operates exclusively for the collective investment of the assets for the three Participating Plans which invest into the Fund. They are all single-employer defined benefit pension plans. | The Fund has confirmed that each of the three Participating Plans is exempt from taxation in the Fund's resident country and intend to remain that way for the foreseeable future. | Each Participating Plan provided a Participating Trust Information Statement. | These plans were established by the XXXXX (the Company) and its affiliated corporations in order to provide benefits to its employees upon their retirement, disability or death. | Plan 1 was established by the Company and participating employer companies to provide benefits to eligible employees upon their retirement, disability or death. | The Board of Directors for Plan 1 is the Board of Directors and/or the Executive Committee of the Company. | Plan 1's Plan Document set out the eligibility for participants, taking into account the year participants joined employment, their age and the hours of employment in a 12-month period, along with grandfathered eligibility from previous rules. | Plan 1's Plan Document sets out that employees who are hired from 1 January 20XX onwards will immediately become a Participant of this plan. | The normal retirement age for individuals who became participants on or after 1 January 19XX is the later of the date they attain age X or the date they earn five years of service or five years as a participant of the plan. | Plan 1's Plan Document sets out the funding of the plan, namely the contributions made by Employer Companies to the plan each year, and except where specifically described, no participants may contribute to the fund. | Each plan participant who has attained their normal retirement date may retire from employment with an Employer Company and all Related Employers, and be paid a retirement pension. | The amount of the monthly pension payable to the Participant commencing on their normal retirement date, or later if they delay retirement, is determined per the formula set out in the Plan Document. | Participants may retire early after attaining the early retirement date of the first day of any calendar month following the attainment of the minimum age set out in the plan document, and the completion of ten years service. | A participant with at least 10 years of service who is not approved for disability income benefits under the Company's disability plan, or who has exhausted their benefits under that plan, shall be eligible for a disability retirement benefit if they terminate employment with their employer company and all related employers due to a disability before their early retirement date or after 31 December 20XX. | A participant who has attained their early retirement or normal retirement date prior to experiencing a disability will be eligible to receive their early retirement or normal retirement benefit instead of a disability benefit. | Participants may elect a Beneficiary who will be entitled to the survivor benefit elected by the participant. | A participant may request a reduced monthly retirement benefit so that after their death, an amount of the monthly benefit shall be payable to their surviving spouse for the duration of the Spouse's life. | Plan 2 was established for the exclusive benefit of eligible employees and their beneficiaries, in order to provide benefit payments upon retirement, disability, or death of these employees, effective as of 1 January 19XX. | The Board of Directors for Plan 2 is the Board of Directors and/or the Executive Committee of the Company. | Eligibility for Employees of an Employer under the plan are set out in Plan 2's Plan Document. Eligibility is determined upon the age of the employee and their hours of service. | An Employer under the plan means the Company and any domestic subsidiary or domestic affiliate which adopts the plan with the approval of the Board of Directors and agrees to be bound by the Plan and Trust Agreement. | Normal Retirement age for individuals who become participants on or after 1 January 19XX is the participant reaching age X, or the earlier of completing five years of service or five years of participation in this plan, whichever comes later. | For those who became participants prior to 19XX, normal retirement is age X (or age X for specific employees as set out in the plan document). | Early retirement is the first day of the month following the attainment of age X and the completion of ten service years. | All contributions made to this plan are made only by the Employer, no employee contributions are required or permitted. | The Employer shall, at least annually, contribute to the Trust Fund not less than any amount which the Actuary determines to be actuarially sufficient to meet the minimum funding. | Benefits commence in the first full calendar month in which the conditions for entitlements to benefits are met, and end with the payment made in the month in which the death of the participant occurs. | A participant who terminates employment on their normal retirement date shall receive normal retirement benefits calculated with the formula set out in the Plan Document. This formula takes into account the participants years of service credit and other plan benefit offsets. | Participants may elect either the normal form or option form of payment, providing different payment entitlements and restrictions as set out in the Plan Document. | Participants who terminate employment on or after their early retirement date, but before their normal retirement date, are eligible to receive an early retirement benefit, being a reduced benefit as calculated within the Plan Document. | Disability benefits are available for participants with at least ten vesting years of service if the employee experiences a total and permanent disability while actively engaged in covered employment. | The amount of the benefit payable will be the amount of the benefit to which the participant would be entitled to if they were X years of age and had elected an early retirement benefit based on the years of service the participant has accumulated up to the date of their disability. | Each participant may designate a primary and a secondary contingent beneficiary or beneficiaries. | If a participant dies while in active employment with a related employer their beneficiary will receive a death benefit in one lump sum based on the Participant's years of service credit. | All participants from XX August 19XX have the Qualified Joint and Survivor Annuity effective for the benefit of their spouse, which provides the Spouse a survivor benefit if the participant dies prior to their benefit commencement date. | Participants may receive a qualified joint and survivor annuity, meaning they may request a reduced monthly retirement benefit so that after their death, a percentage of their monthly benefit shall be payable to their surviving spouse for the duration of the Spouse's life. | The Plan Document sets out what will happen to the funds in the Trust should the plan be terminated, partially terminated or otherwise discontinued. The plan document does not state a planned or expected termination date for the plan. | Plan 3 is a jointly trusteed, defined benefit plan established by the Company and Entity 2. | The plan was established to provide benefits to eligible employees of the Company who would have been eligible to participate in the XX Pension Plan, certain former employees who were participants of the aforementioned plan, and eligible employees on the Company on leave to serve a particular role. | The Executive Director of the plan is responsible for the day-to-day administration of the plan in accordance with the Trust Agreement. | An employee is eligible to be a participant of the plan if they meet the requirements of prior participation in other plans set out in Plan 3's Pension Plan Document, or from the first day of the month immediately following the date the employee has completed a year of eligible service and an hour of service in covered employment. | An employer must make contributions to the pension fund as required by the trust agreement. | Plan 3's Plan Document sets out the retirement pension benefits available for participants. | The normal retirement age under Plan 3 is X. | Participants who terminate employment on their normal retirement date will receive a monthly pension for the remainder of their lifetime, calculated per the formula set out in the Plan Document. | Early retirement pension is available for participants who terminate employment on or after their X birthday but before their ordinary retirement age. Monthly pension provided for early retirement is calculated per the formula set out in the Plan Document. | The benefit payable under this plan is reduced by the gross amount of all benefits the participant receives or is entitled to receive under the Plan 2. | From 31 March 20XX, to become eligible for a monthly disability benefit a participant must have at least 10 years of service credit at the time they stop working in covered employment, must have become disabled before their X birthday and while they were an active participant or within X years after becoming an inactive participant, and must not have elected a lump sum disability benefit under the X Plan. | The amount of the monthly disability benefit is based upon the age the participant is when they are found to be disabled, as set out in the Plan Document. | Participants may be eligible to receive a lump sum disability benefit rather than a monthly payment. | In the event of the death of a disabled participant before their normal retirement date and while they have a spouse and eligible to receive a monthly disability benefit, the spouse will receive the surviving spouse benefit as set out in the Plan Document. | The normal form of payment for participants with a spouse is a qualified joint and survivor annuity, where the pensioner is paid a reduced pension for their lifetime, and upon their death their Spouse will receive a lifetime survivorship of a percentage of the reduced monthly amount. | Where a participant dies prior to retiring their Spouse becomes eligible for the percentage of the surviving Spouse benefit if the participant and spouse are married and the participant was eligible for normal retirement pension, service pension, partial service pension or early retirement pension. | The monthly amount of the surviving Spouse benefit is a set percentage of the monthly amount a deceased participant could have received under the qualified joint and surviving annuity payment, determined as if the participant terminated employment the day before their death. | Plan 3's Plan Document sets out steps for the termination of the plan, however explicitly state that it is the intention of the trustees for the plan to continue to operate in full force. | Eligibility for an election to have distributions paid directly into an eligible retirement plan is set out in Plan 3's Plan Document | The Fund has provided a list of Australian investments that it beneficially owns which have the following characteristics: | Does IVA apply to this private ruling?: Part IVA of the Income Tax Assessment Act 1936 contains anti-avoidance rules that can apply in certain circumstances where you or another taxpayer obtains a tax benefit, imputation benefit or diverted profits tax benefit in connection with an arrangement. | If Part IVA applies, the tax benefit or imputation benefit can be cancelled (for example, by disallowing a deduction that was otherwise allowable) or you or another taxpayer could be liable to the diverted profits tax. | We have not fully considered the application of Part IVA to the arrangement you asked us to rule on, or to an associated or wider arrangement of which that arrangement is part. | If you want us to rule on whether Part IVA applies, we will need to obtain and consider all the facts about the arrangement which are relevant to determining whether Part IVA may apply. | For more information on Part IVA, go to our website ato.gov.au and enter 'part iva general' in the search box on the top right of the page, then select 'Part IVA: the general anti-avoidancerule for income tax'. | the Participating Plans are provident, benefit, superannuation or retirement funds | The central management and control of the ParticipatingPlans is carried on outside of Australia by entities none of whom are Australian residents | No amount paid to the Fund or set aside for the Fund has been or can be deducted under the ITAA 1997, and | No tax offsets have been allowed or would be allowable for an amount paid to the Fund or set aside for the Fund. | is less than 10% pursuant to paragraph 128B(3CC)(a) of the ITAA 1936 at all relevant times; and | would be less than 10% in the circumstances detailed in paragraph 128B(3CC)(b) of the ITAA 1936 at all relevant times. | Neither the Participating Plans, nor any related party, are involved in the day to day management of the business of any of the Australian companies or trusts. | Neither the Participating Plans, nor any related party, have the right to appoint a director to the Board of Directors of the Australian company, Australian debt issuer or equivalent role in a trust. | Neither the Participating Plans, nor any related party, hold the right to representation on any investor representative or advisory committee (or similar) of the Australian companies or trusts. | Neither the Participating Plans, nor any related party, have the ability to direct or influence the operation of the Australian companies or trusts outside of the ordinary rights conferred by the equity interest held. | The Participating Plans have not entered into or received any side letters, arrangements or agreements. | The Participating Plans only hold rights to vote in proportion to its equity interest in each of the Australian companies or trusts.