Gov’t agrees to same-sex super entitlements
The Federal Government has given in to long term pressure by lobby groups and the Democrats to offer the same superannuation benefits to same-sex couples in the area of tax-free superannuation death benefits.
The changes were announced yesterday by the Minister for Revenue and Assistant Treasurer, Senator Helen Coonan as part of a wider change to cover those in ‘interdependent’ relationships.
“This is a family friendly proposal which recognises that adult family members who reside together and offer each other mutual support may not receive the same treatment as spouses or dependent children upon the death of a partner or family member,” Coonan says.
According to Coonam there has been concern surrounding interdependent adult relationships and that some may not fall within the current definition of financial dependency which the Minister has stated as “one of continuing mutual commitment to financial and emotional support between two people who reside together”.
Coonan says example of interdependent relationships include those with disabilities dependent on another adult, elderly siblings who live together and an adult child who resides with and cares for an elderly parent.
The legislation has yet to reach Parliament but would allow a member of an interdependent couple to nominate their partner to receive their superannuation benefits when they die but also opens the way for same-sex couples to receive the super benefits.
In doing so the tax free status on the benefits applied to opposite sex couples will now also apply to same-sex couples.
Under currently industry regulations within the Superannuation Industry (Supervision) Act 1993 (SIS) superannuation funds were not able to pay death benefits to a same-sex partner unless they could demonstrate they were financially dependent on the deceased member, which in many cases had been difficult to prove.
The moves have been welcomed by theAssociation of Superannuation Funds of Australia(ASFA) which says the changes open the way for gay and lesbian couples living together in interdependent relationships to inherit their partner's super.
“ASFA wholeheartedly supports this move to remove discrimination against same-sex couples in a superannuation context,” ASFA chief executive Philippa Smith says.
AUTHOR
Jason Spits
Recommended for you
Insignia Financial has issued a statement to the ASX regarding a potential bid from a third global private equity business to acquire the firm.
More than 30 advisers fell off the FAR during the Christmas and New Year period, according to Wealth Data, with half of these coming from licensee giant Entireti.
With next-generation heirs unlikely to retain their family’s financial advisers after receiving an inheritance, Capgemini has explored how firms can work with younger generations to maintain a relationship.
The use of technology and data analytics will be a way for advice firms to grow in 2025, according to Adviser Ratings, with those who are using it successfully reporting 10 per cent higher profit margins.
