Document ID: chunk:federal_register_of_legislation:C2022C00264:clause:11_146c:p2
Version: federal_register_of_legislation:C2022C00264
Segment Type: clause
Provision Reference: sch 11 cl 146C (pt 2/2)
Character Range: 595139–597322

the effect of reducing the pension below zero; and
 (c) is to be known as the surcharge commutation amount in relation to the pension for the purposes of this section.
 (4) The sum of the amounts specified in the elections set out in a notice under paragraph (1)(f) must be equal to or less than the amount of the surcharge under the assessment.

Entitlement to lump sum benefit
 (5) If a person makes an election under subsection (1) in relation to a pension, the person is entitled to a lump sum benefit equal to the surcharge commutation amount.
 (6) If a person is entitled to a lump sum benefit under subsection (5), the liability to pay that benefit must be discharged by:
 (a) paying the amount of that benefit to the Commissioner of Taxation in accordance with the person's request; and
 (b) informing the Commissioner of Taxation of the person's request that the amount be wholly applied in payment of surcharge under the assessment concerned.

Reduction of pension
 (7) If a person makes an election under subsection (1) in relation to a pension, the annual rate of the pension is to be reduced, with effect from the beginning of the day of the election, so that it equals the amount worked out using the following formula:

where:
conversion factor means the factor that is applicable to the person under the determination made by CSC under section 146D.
pre‑commutation election pension rate means the annual rate at which the pension was payable to the person immediately before the election was made.

One election per assessment
 (8) A person is not entitled to make more than one election under subsection (1) in relation to a particular assessment unless the elections:
 (a) relate to different pensions; and
 (b) are made on a single occasion; and
 (c) are set out in the same notice under paragraph (1)(f).

Elections made before the first pension pay day
 (9) If an election under subsection (1) is made during the period:
 (a) beginning on 1 January or 1 July in a year; and
 (b) ending at the end of the first pension pay day after that 1 January or 1 July;
this section has effect as if the election had been made on the first day after that pension pay day.