Child pensions

A child pension is a simple way to provide tax-effective income to your children under 18 years of age, or certain other children that have a financial or disability dependency, in the event of your premature death.

A child pension may be selected in conjunction with other non-lapsing nominations that you have made. This means that you can nominate either part or all of your benefit to be paid as a child pension to one or more of your children. A child pension must be fully paid out when the child reaches age 25, unless the child has a qualifying disability.

The benefits of a child pension may include:

• the payment of a regular income stream that, subject to the prescribed minimum payment, can be structured to suit your child’s needs
• the flexibility to restrict access to a lump sum until your child reaches a nominated age of up to 25 years (or earlier where required by law)
• tax-effective treatment of income payments, and
• tax-free treatment of any lump sum withdrawals that are paid to the child. Generally, the pension must be paid in trust for the child’s benefit.

Your nomination will be binding upon the trustee if it is made in the prescribed manner, accepted by the trustee and the law permits the child to be paid a pension upon your death. If the law does not permit us to pay a child pension but your nomination is otherwise valid, we will pay the relevant portion of your death benefit nomination to the nominated child as a lump sum. Refer to the Estate Planning section of the current Product Disclosure Statement for more information.

You may also instruct us on any other restrictions that are to apply on the child pension. However, it is important that you keep your nomination and terms up to date as these can’t be changed after your death.

You may change:

• the child you have nominated
• your request to pay all or part of your benefit as a child pension, or
• the terms of the child pension

at any time by completing a new child pension schedule and/or, if required, a new non-lapsing death benefit nomination form.

You can make a child pension nomination if you are a member of one of the following products:

• Macquarie Super and Pension Manager
• Macquarie Super and Pension Manager II
• Macquarie Super Accumulator
• Macquarie Super and Pension Consolidator
• Macquarie Super and Pension Consolidator II
• Macquarie Super and Pension (Vision), or
• Premium Portfolio Service Super and Pension Service

Please note that if you have nominated a reversionary beneficiary on a pension account, you will be unable to also make a non-lapsing death benefit nomination (including a child pension nomination) for that account.

Where your child is under the age of 18 or is otherwise legally unable to manage their own affairs, your child must have a representative appointed to their account.

Representatives acceptable to the trustee include:

• a surviving parent
• the child’s guardian
• the child’s legal personal representative, or
• the trustee of a trust established for the child’s benefit.

The trustee of the Macquarie Superannuation Plan may require a potential representative to complete a statutory declaration to ensure that proceeds of the pension are used for the child’s benefit.

Children over the age of 18 and not suffering from a legal disability  will be responsible for managing their own account but will be subject to any restrictions applied under the nomination (refer to What restrictions may I apply to my child pension nomination? below for more information).

Your child, or their appointed representative where applicable, will be responsible for all administration and investment decisions relating to the child pension. This may include the amount of pension that is to be paid to the child each year (where you have not specified an annual pension amount in the child pension schedule).

Pension payments and lump sum commutations can be made to a bank account held:

• in your child’s name
• in the name of your child’s appointed representative as trustee for the child, or
• in the name of a trust established for your child’s benefit.

You may elect to restrict your child’s ability to alter your prespecified annual pension payment amount and frequency up to a nominated age. You may also restrict the payment of any lump sum withdrawals until your child reaches that same nominated age.

However, you can’t restrict your child’s ability to rollover the benefits to another provider. Your child may, therefore, roll the benefits to another fund and access a lump in that other fund.

We will be bound by your instructions with regard to the annual payment amount and the payment of a lump sum withdrawal (unless we are required by law to make such a payment). Once your child reaches the age of 25, any amount remaining in the pension account must be paid in full as a lump sum (regardless of any restrictions you have placed on the annual payment amount), unless they have a qualifying disability.

Complete the following forms:

• a Non-lapsing Death Benefit Nomination form, available from your adviser or from Macquarie, nominating your child as a beneficiary, and
• a Child Pension Schedule outlining the terms of the pension.

For more information, speak to your financial adviser. Your nomination of a child pension, if consented to by the trustee to be effective, is binding on the trustee and must therefore be made in the prescribed manner. A nomination can’t be made, amended or revoked by power of attorney or by any other agent.