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| A glossary of common superannuation terms
Index
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Commuted
This is the process of converting a pension or annuity into a lump sum payment. This payment can be paid to the beneficiary or rolled over to another product within the same superannuation fund, or to another superannuation fund. |
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Complying Superannuation Fund
A superannuation Scheme or Fund which complies with the operational standards specified in the SIS Regulations and therefore qualifying for lower tax rates. |
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Custodian
An entity is a custodian if it carries on a business that predominantly consists of providing custodial or depository services (as defined by section 766E of the Corporations Act 2001) pursuant to an Australian financial services licence. |
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Dependant
In relation to a person, includes the spouse of the person, any child of the person and any person with whom the person has an interdependency relationship. |
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Eligible spouse contribution
Contributions which are made on behalf of a spouse, the contributing spouse may be entitled to a tax offset. These are non-concessional contributions for the receiving spouse and are subject to the non-concessional contributions cap. |
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Employer-sponsors
The employer has elected the Fund to provide superannuation services to its employees. |
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Income Stream
A pension or annuity. |
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Interdependent Relationship
Under SIS Act, generally two persons have an interdependency relationship if they have a close personal relationship; and they live together; and one or each of them provide the other with financial support; and one or each of them provides the other with domestic support and personal care. In the case of either or both parties suffer from a physical, intellectual or psychiatric disability having only close personal relationship will suffice. |
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Legal Personal Representative
Under SIS Act, means the executor of the will or administrator of the estate of a deceased person, the trustee of the estate of a person under a legal disability or a person who holds an enduring power of attorney granted by a person. |
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Preservation
The legal requirement that certain superannuation benefits must be retained in a superannuation fund or rollover fund until the member retires after reaching preservation age. Only in very limited circumstances, including total and permanent disablement and extreme financial hardship, can preserved amounts be released before the member reaches this age. |
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Preserved amounts
See Preservation. |
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Reduced input tax credit
The eligible amount which the Fund can claim back for the GST paid. |
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Severe Financial Hardship
A set of conditions which under superannuation law and APRA guidelines, allows the early release of superannuation, for more information please see the APRA website or contact Member Services. |
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SLS
Superannuation Lump Sum is a lump sum payment sourced from your Superannuation to establish your Pension account. |
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Spouse
Another person (whether of the same sex or a different sex) who is legally married to you or a person, who although not legally married to you, lives with you on a genuine domestic basis in a relationship as a couple. |
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Superannuation entity
See Complying Superannuation Funds. |
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Superannuation Industry (Supervision) Act 1993 (Commonwealth)
The legislation that governs the operation of all complying superannuation schemes or funds. |
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Total and Permanent Disability (TPD)
The definition(s) used by the Insurer to determine if an insured benefit is payable. The Supplementary Product Disclosure Statement contains the various definitions of TPD. |
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Total and permanent incapacity (for condition of release purposes)
In relation to a member means ill health (whether physical or mental), where the Trustee is reasonably satisfied that the member is unlikely, because of the ill health, to engage in gainful employment for which the member is reasonably qualified by education, training or experience. |
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Trust Deed
The legal document which sets out the rules governing the operation of a superannuation fund. Members are entitled to view a copy of the trust deed. |
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Un-restricted non-preserved benefit
These are generally benefits which the member has previously met a condition of release and was entitled to be paid but has voluntarily decided to keep within the superannuation system. There are no restrictions for paying these superannuation benefits out to a member at any time on demand, irrespective of age, employment situation or financial position, providing the superannuation fund rules allow the payment. |
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Vested
The inclusion of all or part of the employer contributions in the benefit payment to a member who leaves his or her employment before being eligible for a retirement benefit. "Full vesting" means that the member is entitled to all of the employer contributions, while "partial vesting" means that only a portion of the employer's contributions are applied to the member's benefit. |
