Document ID: chunk:federal_register_of_legislation:F2024L00664:schedule:13:p5
Version: federal_register_of_legislation:F2024L00664
Segment Type: schedule
Provision Reference: sch 13 (pt 5/23)
Character Range: 253773–257132

– taxable component
Age of payee            Tax offset
Below preservation age  Nil
60 years or over        Untaxed element × 10%

Super death benefits paid to a dependant
Age of deceased   Age of recipient  Tax offset
Below 60 years    Below 60          Taxed element × 15%
Below 60 years    60 and over       Untaxed element × 10%
60 years or over  Any age           Untaxed element × 10%

Disability super income stream – taxable component
Age of payee            Tax offset
                        Taxed element × 15%
Below preservation age
                        Untaxed element = Nil
60 years or over        Untaxed element × 10%

Step 4: For some payees, the application of the offset from step 3 leads to under withholding for their Medicare levy. An offset adjustment is required where the tax offset calculated in step 3 is greater than zero. Use the applicable formulas below to calculate the offset adjustment amount. You will need to calculate the weekly equivalent of the taxable component or untaxed element if making fortnightly, monthly or quarterly payments. If an offset adjustment is not required, set the offset adjustment to zero.

Adjustment amounts per taxable component amount
Equivalent amount                                                                                                        Offset adjustment amount
  (on a weekly basis)
Under 60 years of age                                                                                                    60 years of age or over
Less than the Medicare levy threshold for singles                                                                        Nil                                                               Nil
Greater than the Medicare levy threshold for singles, but less than the Medicare levy shade out point (SOP) for singles  (Taxable component − Medicare levy threshold for singles) × 0.10  (Untaxed element − Medicare levy threshold for singles) × 0.10
Greater than or equal to the Medicare levy SOP for singles, but less than $1,181                                         Taxable component × 0.02                                          Untaxed element × 0.02
Greater than $1,180                                                                                                      Nil                                                               Nil

Medicare levy parameters are contained in Schedule 1 - Statement of formulas for calculating amounts to be withheld.

Step 5: Calculate the notional amount to withhold by first subtracting the tax offset per payment (step 3) from the withholding amount (step 2).

  Notional amount to withhold = withholding amount − tax offset

Then compare the notional amount to withhold with the offset adjustment amount calculated at step 4.

If the notional amount to withhold is:
    * less than the amount calculated at step 4, withhold the amount calculated at step 4
    * more than the amount calculated at step 4, withhold the notional amount to be withheld.

Tax-free component

If the super income stream is being paid to a payee under 60 years of age, you do not need to consider their tax-free component when calculating their withholding.
Example: Case A - Payee is under 60 years of age

This example uses the PAYG withholding tax tables that apply from 1 July 2024.

Veronica, 58, receives a