The Treasury Laws Amendment (2019 Measures No 3) Bill 2019 was introduced into the House of Representatives on 5 December. The Bill proposes changes to the rules affecting minors and testamentary trusts, as well as minor and technical amendments across a range of Treasury laws.

The Bill clarifies that minors will only be taxed at adult marginal tax rates in respect of income a testamentary trust generates from assets of the deceased estate, or the proceeds from the disposal of these assets. This change will apply to assets acquired by or transferred to the trustee of a testamentary trust estate on or after 1 July 2019.

The following super-related changes are also included:

  • market-linked pensions – the Bill corrects a valuation error under the pension transfer balance cap rules where a market-linked pension, that is a capped defined benefit income stream, is commuted and rolled over, or involved in a successor fund transfer;
  • death benefit rollovers involving insurance proceeds – the Bill ensures that super death benefits that include life insurance proceeds with an untaxed element are not subject to tax when they are rolled over to a new superannuation fund. However, the new pension may have an untaxed element which could have negative income tax consequences when compared to the original death benefit pension; and
  • super downsizer contributions – the Bill ensures that the rules operate as intended. For example, an amendment will ensure that the market value substitution rule cannot increase the amount of capital proceeds received in relation to the disposal of their ownership interests in a dwelling.

Further information

Parliament of Australia, Treasury Laws Amendment (2019 Measures No 3) Bill 2019 and explanatory memorandum, 5 December 2019

Related products

Contact us

Monday to Friday 8am – 6pm (Sydney time)

1800 808 508

Talk to us today

To speak to a specialist complete this form and we'll be in touch.

Help and support

Visit our Adviser Help Centre and search our adviser FAQs.

Additional information

Any information on this page in relation to mortgages has been prepared by Macquarie Securitisation Limited (MSL) Australian Credit Licence (ACL) 237863 ACN 003 297 336.

Unless stated otherwise, this information has been prepared by Macquarie Bank Limited ABN 46 008 583 542 AFSL and Australian Credit Licence 237502.

This information is provided for the use of licensed and accredited brokers and financial advisers only. In no circumstances is it to be used by a potential client for the purposes of making a decision about a financial product or class of products.