Proportioning Rules
As part of the changes to super that came into effect on 1 July 2007, proportioning rules were introduced. The proportioning rules apply to partial payments made prior to age 60. For MilitarySuper Members, this meant that if you had not reached your preservation age and you claimed your non-preserved (i.e. pre-July 1999) member benefit, the payment would include both tax free and taxable components in the same proportions as existed in your total member benefit. You could no longer apply all your available tax free component to the payment.
However, the legislation has now been changed for MilitarySuper Members with retrospective effect to 1 July 2007. This change means that if you are under preservation age and you take your pre-July 99 member benefit, you can choose whether to apply all your available tax free amount against your lump sum (up to the amount of your pre- July 99 benefit), or whether to apply the proportioning rules. ComSuper will be writing to all members who have been paid a partial payment since 1 July 2007 outlining available options.