These credits increase your transfer balance account and reduce your available personal TBC space.
SUPERANNUATION INCOME STREAMS
An income stream is a series of periodic benefit payments to a member. This includes both reversionary and non-reversionary death benefit income streams and can be either:
ACCOUNT-BASED INCOME STREAM
If you were receiving an account-based superannuation income stream just before 1 July 2017, and you continued to receive it after that date, your fund will have reported the value of all the superannuation interests that support the income stream in retirement phase that you were receiving at that time.
If you started an income stream after 1 July 2017, your fund will report the commencement value of that superannuation income stream. This includes death benefit incomes streams and market linked pensions
Transition-to-retirement income streams (TRIS) that are in retirement phase are also included in the transfer balance account. Your TRIS will start to count towards your transfer balance cap on the day it becomes a retirement phase income stream based on its value on that day.
CAPPED DEFINED BENEFIT INCOME STREAMS
Capped defined benefit income streams are treated differently because you usually can’t commute these income streams, except in limited circumstances.Capped defined benefit income streams are:
The modified value of a capped defined benefit income stream is referred to as the “special value”, and this value will be calculated by your superannuation provider.
A capped defined benefit income stream will not give rise to an excess transfer balance by itself. However, you may have an excess transfer balance when you have a combination of both an account-based income stream and a capped defined benefit income stream. If the combined value of the account-based income stream and the special value of the capped defined benefit income stream is in excess of the general TBC, then you will be required to commute the excess transfer balance from the account-based income stream.
TRANSFER BALANCE CAP
The transfer balance cap (TBC) is a limit on how much superannuation can be transferred from your accumulation superannuation account to a tax-free retirement phase account. At present, the general TBC is currently $1.6 million and all individuals have a personal TBC of $1.6 million.
However the general TBC is to be indexed from 1 July 2021, and will rise to $1.7 million. From then on there will be no single cap that applies to all individuals. Every individual will have their own personal TBC, somewhere between $1.6 million and $1.7 million, depending on their circumstances.
If you exceed your personal TBC, you may have to:
If the amount in your retirement phase account grows over time (through investment earnings) to more than your personal TBC, you won’t exceed your cap. However if the amount in your retirement phase account goes down over time, you can’t “top it up” if you have already used all of your personal cap space.