The Government recently announced it would provide transitional relief to defer the proposed changes to superannuation funds regarding their claims for deductions for Total and Permanent Disability (TPD) insurance premiums.
Now, funds may claim a full deduction for TPD premiums until 30 June 2011.
After that time the legislation will require a policy to meet the “disability superannuation benefit” definition.
This will require two medical practitioners to certify that because of the ill-health, the client is unlikely to ever be gainfully employed in a capacity for which he or she is qualified because of education, experience or training.
After 30 June 2011, insurance premiums will need to be split – with “any occupation” TPD insurance to be held inside the super fund and the balance of the “own occupation” cover held outside super. This will ensure full access to benefits in the event of a claim, and will also be most tax effective after the change in the legislation takes effect.
Please consider this important change when reviewing your insurances.
After 30 June 2011, insurance premiums will need to be split – with “any occupation” TPD insurance to be held inside the super fund and the balance of the “own occupation” cover held outside super. This will ensure full access to benefits in the event of a claim, and will also be most tax effective after the change in the legislation takes effect.
Please consider this important change when reviewing your insurances.
