Account Based Pension Certificates

Manage your fund’s actuarial certificate requirements efficiently

If you require an Account Based Pension certificate, you can choose to receive either:

If you choose to have the certificate prepared manually, HA offers a same day turnaround service.

For certificate purposes, account based pensions include term allocated pensions, market linked pensions and transition to retirement pensions.

Account based pension certificate requirements

For the purposes of Income Tax Assessment Act 1977 Section 295-390 (which deals with the proportion of the fund’s income that qualifies for exemption from tax), account based pension certificates are required if the fund’s assets are not fully segregated to individual member accounts and if there were at least one accumulation balance and at least one pension balance throughout the financial year.

The following extract from the Act covers asset segregation and sets out the formula to be used to determine the proportion of income that is exempt from tax.

Click here to view the ITAA Extract

Note that an actuarial certificate is not required if the Fund has incurred a tax loss.

To obtain a certificate manually, download the request form, complete it, and email it back – the certificate will then be emailed to you within a few hours.

Download certificate request form below:

Guidance with the certificate request forms for account based pensions

When completing the above form, the following points should be noted:

  • The values of the assets must be market values.
  • All pensions paid must be paid in cash – an in-species transfer from the SMSF to the member is not permitted.
  • A member’s pension account cannot receive contributions during the year – the contributions must be credited to a separate accumulation account. A member may have more than one pension account but cannot have more than one accumulation account.
  • SMSFs are required to have an investment strategy that should be reviewed regularly, keeping in mind that the investments must provide the income or capital to pay the minimum pensions required under the Regulations. Investments that might create problems include illiquid assets such as unlisted managed funds and real property.
  • A SMSF cannot receive contributions (other than SG contributions) on behalf of a member aged 65 to 74 unless the member has met the work test, i.e. he/she was gainfully employed for at least 40 hours in 30 consecutive days during the financial year.
  • A member may start a pension part way through the financial year. When a member’s accumulation account is to be transferred to a pension account part way through the financial year, the accumulation account should be valued at the day before transfer. This value determines the amounts of pension that can be taken in the financial year.