Commonwealth Numbered Acts

SOCIAL SECURITY ACT 1991 No. 46, 1991 - SECT 9

9. (1) In this Act, unless the contrary intention appears:

"accruing return investment" means an arrangement by a person that consists of
or includes an investment of money, being an investment:

   (a)  that produces:

        (i)    a fixed rate or quantifiable rate of return, whether or not
               that rate varies from time to time; or

        (ii)   a rate of return that may be reasonably approximated; and

   (b)  the value of which from time to time is unlikely to decrease as a
        result of market changes;
Note: a superannuation benefit may be taken to be an investment - see
subsection (6).

"annual rate of return" has the meaning given by subsection (3);

"approved deposit fund" means a fund that is an approved deposit fund for the
purposes of Subdivision AA of Division 2 of Part III of the Income Tax
Assessment Act;

"assessable growth component", in relation to an amount of superannuation
benefit, means so much (if any) of the return as is attributable to the
assessable period;

"assessable period", in relation to a person, means any period during which
the person received:

   (a)  a social security or service pension; or

   (b)  a social security benefit;
except any such period that occurs before a continuous period of at least 2
years during which the person did not receive such a pension or benefit;
     Note: "social security pension" includes a sheltered
employment or rehabilitation allowance.

"deductible amount", in relation to an immediate annuity or a superannuation
pension, is the amount that would be the deductible amount in relation to the
annuity or superannuation pension in relation to a year of income under
subsection 27H (2) of the Income Tax Assessment Act if "undeducted purchase
price" had the same meaning in that subsection as " non-assessable purchase
price" has in this Act;

"deferred annuity" means an annuity that is a deferred annuity for the
purposes of Subdivision AA of Division 2 of Part III of the Income Tax
Assessment Act;

"determination of entitlement", in relation to a person, means a
determination:

   (a)  whether the person is qualified for a pension, benefit or allowance
        under this Act; or

   (b)  whether a pension, benefit or allowance under this Act is payable to
        the person; or

   (c)  of the rate at which a pension, benefit or allowance under this Act is
        payable to the person;

"eligible investment" means an investment that satisfies all of the following
conditions:

   (a)  money or property invested is paid or transferred by the investor
        directly or indirectly to a body corporate or into a trust fund;

   (b)  the assets that represent money or property invested
(in this definition called the "investment assets") are held otherwise than in
the names of investors;

   (c)  the investor does not, either alone or jointly with a relative or
        relatives of the investor, have effective control over the management
        of the investment assets;

   (d)  the investor has a legally enforceable right to share in any
        distribution of the income or profits derived from the investment
        assets;

"friendly society" means:

   (a)  a society registered as a friendly society under a law in force in a
        State or Territory; or

   (b)  a society that had, before 13 December 1987, been
approved for the purpose of the definition of "friendly society" in subsection
115 (1) of the 1947 Act;
    and, for the purpose of the definition of "market-linked
investment" in this subsection, includes:

   (c)  a society that has been approved for the purposes of the definition of

"friendly society" in subsection 115 (1) of the 1947 Act on or after 13
December 1987; and

   (d)  a society that is an approved friendly society for the purposes of
        this Act (see section 29);

"fund manager", in relation to an investment product, means the person or body
specified, in relation to that investment product, in a notice under
subsection (2);

"immediate annuity" means an annuity that is presently payable;
Note: for "presently payable" see subsection (5).

"investment product" means a class of market-linked investments specified in a
notice under subsection (2);

"market-linked investment" means:

   (a)  an investment in:

        (i)    an approved deposit fund; or

        (ii)   a deferred annuity; or

        (iii)  a public unit trust; or

        (iv)   an insurance bond; or

   (b)  an investment with a friendly society; or

   (c)  an eligible investment other than an investment referred to in
        paragraph (a) or (b); or

   (d)  a superannuation benefit vested in a person and held in a
        superannuation fund (unless a superannuation pension funded by that
        benefit is presently payable to the person); other than an investment
        that is:

   (e)  an accruing return investment; or

   (f)  an investment consisting of the acquisition of real property, stock or
        shares;

"non-assessable purchase price":

   (a)  in relation to an immediate annuity other than a roll-over
immediate annuity - has the same meaning as "undeducted purchase price" has in
Subdivision AA of Division 2 of Part III of the Income Tax Assessment Act; or

   (b)  in relation to a roll-over immediate annuity - means the
        roll-over purchase price; or

   (c)  in relation to a superannuation pension - has the same
meaning as "undeducted purchase price" has in Subdivision AA of Division 2 of
Part III of the Income Tax Assessment Act;

"public unit trust" means a unit trust that:

   (a)  except where paragraph (b) applies - was, in relation to the unit
        trust's last year of income, a public unit trust for the purposes of
        Division 6B of Part III of the Income Tax Assessment Act; or

   (b)  where the first year of income of the unit trust has not yet finished
        - has, at some time since the trust was established, satisfied at
        least one of the paragraphs of subsection 102G (1) of the Income Tax
        Assessment Act;

"purchase price", in relation to an annuity, has the meaning that it has in
Subdivision AA of Division 2 of Part III of the Income Tax Assessment Act;

"rate of return decision", in relation to an investment product, means:

   (a)  a refusal, on application under subsection 1089 (1), to make a
        determination under subsection 1088 (1) of a rate of return on
        market-linked investments included in the investment product; or

   (b)  a determination under subsection 1088 (1) of a rate of return on
        market-linked investments included in the investment product; or

   (c)  the revocation under section 1092 of a determination of a rate of
        return on market-linked investments included in the
        investment product.
Note: this definition relates to Subdivision C of Part 3.10 (Market-Linked
Investments) and Parts 6.2 and 6.4 (Review by the Social Security Appeals
Tribunal and the Administrative Appeals Tribunal).

"relevant number", in relation to an annuity, has the meaning that it has in
section 27H of the Income Tax Assessment Act;

"residual capital value", in relation to an annuity, has the meaning that it
has in Subdivision AA of Division 2 of Part III of the Income Tax Assessment
Act;

"return", in relation to an investment (including an investment in the nature
of superannuation), means any increase, whether of a capital or income nature
and whether or not distributed, in the value or amount of the investment;

"rolled-over amount", in relation to an annuity, has the meaning that it has
in Subdivision AA of Division 2 of Part III of the Income Tax Assessment Act;

"roll-over immediate annuity", means an immediate annuity the purchase price
of which consists wholly of a rolled-over amount or rolled-over amounts;

"roll-over purchase price", in relation to a roll-over immediate annuity,
means:

   (a)  except where paragraph (b) applies - either the sum of the following
        amounts:

        (i)    the amount that would, under Subdivision AA of Division 2 of
               Part III of the Income Tax Assessment Act, be the
               undeducted purchase price of the annuity;

        (ii)   the amount that is the upper limit under section 159sg of the
               Income Tax Assessment Act for the year of income in which the
               annuity was purchased;
or the purchase price of the annuity, whichever is less; or

   (b)  where:

        (i)    the roll-over immediate annuity, and another
               roll-over immediate annuity, have been purchased using the same
               rolled-over amount or rolled-over amounts in the name of the
               same person; and

        (ii)   the roll-over purchase price of the other roll-over immediate
               annuity has previously been worked out under paragraph (a) for
               the purposes of this Act; the amount that would, under
               Subdivision AA of Division 2 of Part III of the Income Tax
               Assessment Act, be the undeducted purchase price of the
               annuity;

"statutory rate of return" means 11% per year or such lower percentage per
annum as is specified in a notice in force under subsection 1087 (1);

"superannuation benefit", in relation to a person, means a benefit arising
directly or indirectly from amounts contributed (whether by the person or by
any other person) to a superannuation fund in respect of the person;

"superannuation fund" means a superannuation fund as defined for the purposes
of Subdivision AA of Division 2 of Part III of the Income Tax Assessment Act,
other than a fund covered by subparagraph (ia) of the
definition of "superannuation fund" in subsection 27A (1) of that Act;

"superannuation pension" has the same meaning as it has in Subdivision AA of
Division 2 of Part III of the Income Tax Assessment Act.

(2) The Secretary, by notice in writing published in the Gazette:

   (a)  may specify a class of market-linked investments that constitute an
        investment product; and

   (b)  is to specify, in relation to each investment product so identified, a
person or body for the purposes of the definition of "fund manager" in
subsection (1).

(3) Where the value or amount at a particular time of a market-linked
investment included in an investment product is equal to or less than the
value or amount of that market-linked investment 12 months previously, the
annual rate of return at that first-mentioned time for market-linked
investments included in that investment product is to be taken, for the
purposes of a determination under this Act, to be 0%.

(4) A reference in this Act to the Secretary refusing, on application under
section 1089, to make a determination under subsection 1088 (1) does not
include a reference to the Secretary refusing, pursuant to subsection 1090
(2), to consider such an application.

(5) For the purposes of this Act, an annuity or superannuation pension is to
be taken to be presently payable at all times after, but not before, the
commencement of the first period in respect of which the annuity or
superannuation pension is payable.

(6) For the purposes of the definition of `accruing return investment' in
subsection (1), a superannuation benefit vested in a person that is held in a
superannuation fund is to be taken to be an investment of that person, unless
a superannuation pension funded by that benefit is presently payable to the
person.

(7) For the purposes of this Act, a person's superannuation benefit is
compulsorily preserved if the person's access to the benefit is restricted
under:

   (a)  paragraph 23 (ja) of the Income Tax Assessment Act as in force at any
        time before 18 December 1987; or

   (b)  section 23fa of the Income Tax Assessment Act as in force at any time
        before 18 December 1987; or

   (c)  regulations made under section 7 or 8 of the Occupational
        Superannuation Standards Act 1987; or

   (d)  a provision of the trust deed or contract concerned that imposes
        restrictions corresponding to the restrictions imposed by a provision
        of the regulations made under section 7 or 8 of the Occupational
        Superannuation Standards Act 1987.