Income tax Dates
The formula method is complex. We recommend getting advice from a tax agent to use it.
With the formula method you are taxed on the actual gains of your foreign superannuation interest. This tax is between when your 4 year exemption (if any) expires and the date you receive the lump sum.
The formula method cannot be used for:
- transfers from defined benefit schemes
- schemes where the total interests are below $50,000.
The formula
The equation for working out your assessable income under this method is:
gain x (grow rate - 1) x tax rate x (assessable years - 1) + gain
The variables
| Variable | Defintion |
|---|---|
|
Gain |
(Super withdrawal x calculated gains fraction) - other gains |
|
Grow rate |
(Accrued total ÷ value) to the power of (1 ÷ assessable years) |
|
Assessable years |
The number of income years from the beginning of the assessable period until the withdrawal takes place. If the number of income years is less than 1 then the number of assessable years to use is 1. |
|
Tax rate |
The highest prescribed investor rate |
|
Accrued total |
The value of the scheme immediately before the withdrawal, plus any previous withdrawals during the assessable period, less any recognised contributions during the assessable period |
|
Super withdrawal |
The amount of the foreign superannuation withdrawal |
|
Other gains |
The total amount of gains (as defined above) for previous withdrawals in the assessable period |
|
Calculated gains fraction |
(Predistribution + withdrawals - value - contributions) ÷ predistribution |
|
Predistribution |
The value of the person's scheme immediately before they made their foreign superannuation withdrawal |
|
Withdrawals |
The total amount of previous foreign superannuation withdrawals made in the assessable period |
|
Value |
The opening value of the person's scheme at the beginning of their assessable period |
|
Contributions |
The total amount of recognised contributions before the foreign superannuation withdrawal |