The Guides to Social Policy Law is a collection of publications designed to assist decision makers administering social policy law. The information contained in this publication is intended only as a guide to relevant legislation/policy. The information is accurate as at the date listed at the bottom of the page, but may be subject to change. To discuss individual circumstances please contact Services Australia.

1.1.D.44 Deductible amount

Usage

This definition applies to all payments.

Definition

In reference to a defined benefit income stream for a year, a deductible amount means the sum of the amounts that are the tax free components of the payments received from the defined benefit income stream during the year.

The tax-free component is determined with reference to the Income Tax Assessment Act 1997 and the Income Tax (Transitional Provisions) Act 1997.

Note: From 1 January 2016, the deductible amount is capped at 10% of the gross income from the income stream. This means if the income stream has a tax-free component greater than 10% of the gross income from the income stream, the deductible amount for social security purposes is 10% of the gross income from the income stream.

Act reference: SSAct section 9(1)-'deductible amount'

Policy reference: SS Guide 4.9.2.30 Income test assessment of asset-test exempt income streams

Last reviewed: 1 July 2019

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