The Assistant Treasurer has announced that the Government will amend the law exempt people with a terminal illness who access their superannuation under the age of 60 from the tax on their lump sum benefit. Amendments to the legislation will have effect for payments received after 11 September 2007.
The Government has decided to change this area of tax legislation because we believe we need to remove as many of the stresses as possible for people in this terrible situation.
I have been able to look closely at the case of a young woman named Christina Fiddimore in particular, and the awful circumstances she and her family are experiencing.
In this particular case, the Government will provide the support Christina and her family needs, Mr Dutton said.
Until the legislation passes into law, Mr Dutton said the Government has asked the Commissioner of Taxation to consider changing the rate at which superannuation funds are required to withhold from payments to people in these situations.
Further details will be determined in consultation with the superannuation industry, the medical profession and support groups.