Private ruling: Undeducted purchase price of a foreign pension or annuity
Date of advice: 3 February 2021
Published: March 2021
Ruling period: Income year ended 30 June 20XX
Date scheme commenced: 1 July 20XX

Ruling: Q1: Are you entitled to an undeducted purchase price (UPP) deductible amount in respect of your foreign pension? | A1: Yes.

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 Country B. The taxpayer has provided a letter from their pension scheme stating the amount of their personal contributions. The taxpayer's pension commenced on 19 September 20XX and is payable for life. The taxpayer currently receives 100% of the pension and on their death it reverts to their ex-spouse. The residual capital value of the pension is nil. The taxpayer was 58 years of age when they commenced their pension. The taxpayer's ex-spouse was 41 years of age when the taxpayer commenced their 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 Assessment Act 1997 Section 960-50 - currency translation | Income Tax Regulations 1936 Regulation 9 | Income Tax Assessment Regulations 1997 Regulation 960-50.01 - currency translation