Veterans' Entitlements Act 1986

If:

a person is provided with an asset‑test exempt income stream for a period beginning on the first day in respect of which an income stream payment was made to the person and ending on the last day in respect of which an income stream payment was made to the person; and

during the whole or any part of that period an amount of service pension, income support supplement or veteran payment has been paid to the person; and

the whole or any part of the income stream is commuted contrary to the contract or governing rules under which the income stream was provided on the commencement day of the income stream; and

the amount of service pension, income support supplement or veteran payment that has been paid to the person for that period is more than the amount that would have been payable to the person for that period had the income stream not been an asset‑test exempt income stream for the purposes of this Act for that period;

That amount is an amount equal to the difference between the amount of service pension, income support supplement or veteran payment that has been paid to the person during the period worked out under subsection (3) and the amount that would have been so paid to the person had the income stream not been an asset‑test exempt income stream for the purposes of this Act for that period.

The period for the purposes of subsection (2) is the period that:

began on:

the day 5 years before the day the income stream was commuted; or

the commencement day of the income stream; or

20 September 2001;

ended when the income stream was commuted.

In working out the asset value of the income stream had the income stream not been an asset‑test exempt income stream for the period referred to in subsection (2), assume that the income stream was asset tested from the commencement day and that the asset value of the income stream is depleted in accordance with the formula in subsection 52A(4).

Subject to subsection (6), if:

an asset‑test exempt income stream (the old income stream) is commuted, in whole or in part; and

part, but not the whole, of the payment resulting from the commutation of the old income stream (the commutation payment) is transferred directly to the purchase of another asset‑test exempt income stream (the new income stream);

the new income stream is taken to have the same commencement day as:

the old income stream; or

if the old income stream was one of a succession of asset‑test exempt income streams—the first income stream in that succession;

if the old income stream was not one of a succession of asset‑test exempt income streams—income stream payments made under the old income stream are taken to have been made under the new income stream;

if the old income stream was one of a succession of asset‑test exempt income streams—income stream payments made under any of the income streams in that succession are taken to have been made under the new income stream.

Subsection (5) does not apply if the amount used in the purchase of the new income stream represents the whole of the commutation payment remaining after the use of part of the commutation payment in the payment of:

a hardship amount; or

superannuation contributions surcharge that the person is liable to pay in his or her capacity as purchaser of the old income stream.

Subject to subsection (8), if:

the whole of an asset‑test exempt income stream is commuted; and

no part of the payment resulting from the commutation of the income stream is transferred directly to the purchase of another asset‑test exempt income stream; and

the commuted income stream was one of a succession of asset‑test exempt income streams;

the commuted income stream is taken to have had the same commencement day as the first income stream in that succession;

income stream payments made under any of the income streams in that succession (other than the commuted income stream) are taken to have been, at the time when they were made, payments under the commuted income stream.

Subsection (7) does not apply if the whole of the payment resulting from the commutation of the old income stream is used in the payment of:

a hardship amount; or

superannuation contributions surcharge that the person is liable to pay in his or her capacity as purchaser of the old income stream.

For the purposes of this section:

2 or more asset‑test exempt income streams constitute a succession of asset‑test exempt income streams if each income stream (other than the first of those income streams to be provided) has been funded by means of the payment, or part of the payment, resulting from the commutation of another of those income streams; and

an income stream is the first income stream in a succession of income streams if it is the first of those income streams to be provided.

In this section:

This section does not apply to an income stream in relation to which a determination under subsection 5JA(5), 5JB(4) or 5JBA(11) is in force.