Is it possible to minimise tax when you receive a TPD payment? I’m 53 and expecting about $300,000 – do I put into super and will that stop me from being able to access fund when I need it?

Hi Tim,

Is the policy which is paying the TPD owned by you outside of superannuation?

If so, there shouldn't be any tax payable on the payment. It will just be any tax on earnings from here - which might not be an issue, it depends on your other assets and income.

If tax is an issue, you could contribute it to superannuation. If you have met the TPD definition for your insurance policy, you are likely to meet the TPD definition under the SiS act to have access to your superannuation - but not necessarily so make sure you have that checked off before contributing it to super.

The other thing to consider would be Centrelink. If you are able to claim disability support pension, there may be benefits to contributing it to superannuation so that it isn't assessed by centrelink in determining your eligibility.

Cheers

Glenn

VERY complicated and VERY easy to get it wrong.
Get yourself a planner to help you sort this out. TPD means this is probably the only chance you are going to get to do this, so make sure you do it right.

Dont try to sort this out yourself!!!! You cant go back and have another crack at it if you find its been botched.

good luck
bc

Hi Tim,

Glenn and Brendan have provided some great answers and are correct in their assessments, as once you do something with the money you are potentially locking yourself into a strategy.

If you would like to discuss your options further or look at some potentials strategies for your specific situation, please contact me on the below details for a complimentary Appointment.

Thanks,

Ronald Pratap
Principal Financial Adviser
RP Wealth Management
Level 2, 351 Oran Park Drive, Oran Park 2570
T: 02 9188 1547 M: 0434 502 079
E: ronald.pratap@rpwealthmanagement.com.au
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