Defined benefit tax
133-15 Defined benefit tax
Your defined benefit tax for an income year is the amount worked out using the formula:
Start formula *Division 293 tax for the income year times start fraction Defined benefit contribution component over *Taxable contributions for the income year end fraction end formula
where:
defined benefit contribution component means the amount worked out as follows:
work out the lesser of the following for the corresponding *financial year:
your *low tax contributions;
the total amount of your *defined benefit contributions in respect of all *defined benefit interests you have in the financial year;
subtract from the result of paragraph (a) the difference (if any) between:
your *taxable contributions for the income year; and
your low tax contributions for the corresponding financial year.
A difference may exist for paragraph (b) because of the $250,000 high income threshold: see subsection 293‑20(1) of the Income Tax Assessment Act 1997.
Exception—defined benefit contribution component is nil or less
However, if the defined benefit contribution component mentioned in subsection (1) is nil, or a negative amount, no part of the *Division 293 tax for the income year is defined benefit tax.
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