Document ID: chunk:federal_register_of_legislation:F2025C00069:reg:3:p36
Version: federal_register_of_legislation:F2025C00069
Segment Type: reg
Provision Reference: reg 3 (pt 36/52)
Character Range: 158608–161280

the commutation results from the death of the annuitant or pensioner or a reversionary annuitant or reversionary pensioner; or
 (b) the sole purpose of the commutation is:
 (i) to pay a superannuation contributions surcharge; or
 (ii) to give effect to an entitlement of a non‑member spouse under a payment split; or
 (iii) to meet the rights of a client to return a financial product under Division 5 of Part 7.9 of the Corporations Act 2001; or
 (c) for a commutation in part—the account balance of the annuity or pension, immediately after the commutation, is equal to or greater than the minimum payment amount calculated in accordance with Schedule 7, as reduced by the amount of payments (excluding amounts paid by way of commutation) to the annuitant or pensioner already made in the financial year in which the commutation occurs; or
 (d) the annuity or pension has paid, in the financial year in which the commutation takes place, at least the minimum amount prescribed by subregulation (2).
 (2) For paragraph (1)(d), the minimum amount is the amount calculated using the formula:

where:
days in financial year means the number of days in the financial year (365 or 366) in which the commutation takes place.
days in payment period means the number of days in the period that:
 (a) begins on:
 (i) if the annuity or pension commenced in the financial year in which the commutation is to take place—the commencement day; or
 (ii) otherwise—1 July in that financial year; and
 (b) ends on the day on which the commutation is to take place.
minimum annual amount means the minimum amount payable under the annuity or pension, in the financial year, calculated in accordance with Schedule 7.

Division 1A.2—Operating standards

1.08  Restriction on factors for converting pensions
 (1) For the purposes of subsection 31(1) of the Act, it is a standard applicable to the operation of a regulated superannuation fund that the fund must not use a factor, for converting a prescribed pension to a lump sum, that is greater than the pension valuation factor that would apply under Schedule 1B if the commencement day of the pension were the day on which it was commuted.
 (2) Subregulation (1) does not apply to the use of a factor that:
 (a) the Regulator has approved in writing; or
 (b) is for conversion in relation to a commutation to pay a superannuation contributions surcharge; or
 (c) is for conversion in relation to a commutation to give effect to an entitlement of a non‑member spouse under a payment split; or
 (d) is for conversion in relation to a commutation in order to comply with section 136‑80 in Schedule 1 to the Taxation Administration Act 1953.