Self Managed Superannuation Funds Determination SMSFD 2013/1
Date of effect: 1 July 2007



Ruling: 2. This Determination applies to Self Managed Superannuation Funds [1] (SMSFs) and former SMSFs. [2] References in the Determination to SMSFs include former SMSFs unless otherwise indicated.


Appendix: 4. Paragraph 6.21(2A)(a) of the SIS Regulations provides that, if a member dies on or after 1 July 2007, the deceased member's benefits can be cashed in the form of one or more pensions or annuities only if the entitled recipient is a dependant of the member at the time of the member's death. The term 'dependant', which is not defined in the SIS Regulations, has the same meaning as in the Superannuation Industry (Supervision) Act 1993 . [3] Subsection 10(1) of that Act states that a dependant of a person includes any child of the person. 'Child' is also defined in that subsection. 5. If a pension or annuity is to be paid to a child of the deceased member, there is an additional condition in paragraph 6.21(2A)(b) of the SIS Regulations that he or she must, at the time the deceased died, be: 6. Subregulation 6.21(2B) of the SIS Regulations provides: 7. Subsection 8(1) of the Disability Services Act 1986 provides: 8. That description is a broad description of serious, but not necessarily permanent, disability (given the reference to 'or likely to be permanent') that results in a substantially reduced capacity of the person for communication, learning or mobility and the need for ongoing support services. Although some persons having a disability of such a kind may suffer the disability permanently, given the various elements of that description, the circumstances of others may change such that they satisfy that description at one time but not at another. 9. Thus, notwithstanding it was determined that a child of the deceased member aged at least 18 years but less than 25 years had at the time of the member's death a disability of the kind described in subsection 8(1) of the Disability Services Act 1986 , it does not necessarily follow that the child will have a disability that satisfies that description at either of the times referred to in subregulation 6.21(2B) of the SIS Regulations. 10. Consequently, the trustee must determine whether the child has a disability of the kind described in subsection 8(1) of the Disability Services Act 1986 on the day the child turns 25 (or an earlier date, if applicable under paragraph 6.21(2B)(a) of the SIS Regulations). Not previously issued as a draft


Self Managed Superannuation Funds Determinations (whether draft or final) are not legally binding on the Commissioner. However, if the Commissioner later takes the view that the law applies less favourably to you than this determination indicates, the fact that you acted in accordance with this determination would be a relevant factor in your favour in the Commissioner's exercise of any discretion as to what action to take in response to a breach of that law. The Commissioner may, having regard to all the circumstances, decide that it is appropriate to take no action in response to the breach. | Ruling: 1. Yes. In those circumstances, subregulation 6.21(2B) of the Superannuation Industry (Supervision) Regulations 1994 (SIS Regulations) requires the self managed superannuation fund (SMSF) trustee to determine whether the child has a disability of the kind described in subsection 8(1) of the Disability Services Act 1986 (Cth ) on the day the child turns 25 (or an earlier date, if applicable under paragraph 6.21(2B)(a) of the SIS Regulations). | Date of effect: 3. This Determination applies from 1 July 2007. However, the Determination does not apply to taxpayers to the extent that it conflicts with the terms of settlement of a dispute agreed to before the date of issue of the Determination. | Commissioner of Taxation 26 June 2013 | unless the child has a disability of the kind described in subsection 8(1) of the Disability Services Act 1986 on the day that would otherwise be applicable under paragraph (2B)(a) or (b).


Legislative references: SIS Act SIS Act 10(1) SIS Act 10(4) SIS Act 17A SIS Regulations SIS Regulations 6.21(2A)(a) SIS Regulations 6.21(2A)(b) SIS Regulations 6.21(2A)(b)(i) SIS Regulations 6.21(2A)(b)(ii)(A) SIS Regulations 6.21(2A)(b)(ii)(B) SIS Regulations 6.21(2B) SIS Regulations 6.21(2B)(a) Disability Services Act 1986 8(1) Legislative Instruments Act 2003 13(1)(b)
Subject references: Death benefits - superannuation benefits Death benefits dependant Self managed superannuation funds SIS payment standards - trustee obligations