From 1 October 2021, SuperStream Rollovers version 3 is introducing changes to death benefit rollovers. The ATO said these are different depending on whether the rollover is for a dependent adult or child beneficiary.
A dependent child beneficiary is a child of the member who is either under 18 years old, between 18 and 25 years old and is financially dependent on the deceased or living with a permanent disability.
When a fund is undertaking a death benefit rollover, the ATO said the fund must process the rollover electronically using the SuperStream Rollover message.
Where the dependent beneficiary is a child, as soon as practicable, the fund should complete the Death benefit rollover statement (DBRS) and send this to the receiving fund.
For dependent adult and child beneficiaries, the fund should also give a DBRS or a statement with the same information as the DBRS to the dependent beneficiary within 30 days of the rollover payment.
“For example, a dependent child recipient wants to roll their death benefit income stream to Fund B. Fund B sends an Initiate Rollover Request (IRR) via SuperStream to the transferring fund,” the ATO explained.
“Fund A responds with a Rollover Transaction Request (RTR) message via SuperStream, with the appropriate death benefit tax code and the ‘recipient age category’ set to C. Fund B will know (due to the recipient age category value of C) they will also get a DBRS outside of SuperStream.
“If the rollover is a death benefit and the recipient is a dependent child, this is a ‘child death benefit rollover’ and, therefore, the receiving fund will need to check the recipient’s date of birth in relation to the associated cashing obligations.”
