Section 149 — Social Security Act 1991: Payment and income tax consequences of receiving social security pension at rate affected by clause 146

Application (1) This clause applies if clause 146 affects the rate at which a social security pension is payable to a person. Purpose (2) The purpose of this clause is to ensure that the person is treated appropriately in relation to the payment, and income taxation, of the pension by modifying the operation of the social security law (and thus affecting the related income tax law) in relation to the person and the pension. Note: This clause does not modify the operation of subsection 20A(4), which provides for working out the person’s minimum pension supplement amount. Pension supplement amount (3) The social security law applies in relation to the person’s pension as if the amount described in subparagraph 146(4)(a)(i), as affected by any indexation and any relevant reduction described in paragraph 146(4)(a), were an amount added under the pension supplement Module of the relevant Pension Rate Calculator (and therefore used to work out the rate of the pension). Note 1: One effect of subclause (3) is that the amount is the person’s pension supplement amount (as defined in subsection 23(1)). Note 2: If that amount exceeds the person’s pension supplement basic amount (as affected by subclause (4)), other effects of subclause (3) include the following: (a) the excess being tax-exempt pension supplement under subsection 20A(6) of this Act; (b) Part 2.25C (Quarterly pension supplement) of this Act applying, which may affect timing of payment of some of the pension under the Administration Act; (c) the possibility of the minimum amount of fortnightly instalments of the pension being affected under section 43 of the Administration Act; (d) telephone allowance not being payable because of section 1061R of this Act; (e) utilities allowance not being payable because of section 1061T of this Act. Note 3: Yet another effect of subclause (3) is that section 1210 will affect the operation of reductions of the maximum payment rate because of the income test and assets test. Pension supplement basic amount (4) The social security law applies in relation to the person’s pension as if: (a) each reference in the table in subsection 20A(5) to $507 were a reference to $14,814.80; and (b) the reference in the table in subsection 20A(5) to $423.80 were a reference to $12,373.40. Note 1: This affects the person’s pension supplement basic amount. Note 2: The provisions for indexing amounts in the table in subsection 20A(5) apply to the higher figures mentioned in this subclause. Energy supplement (5) If subclause 147(1) or (2) is relevant to the person, the social security law applies in relation to the person’s pension as if: (a) the energy supplement Module of the relevant Pension Rate Calculator were the same as Module C of Pension Rate Calculator A; and (b) the person’s energy supplement (if any) resulting from that Module were used to work out the rate of the person’s pension. Note 1: This energy supplement is included in the total worked out under paragraph 146(4)(a) (see subparagraph 146(4)(a)(ia)). Note 2: This subclause causes Division 2 of Part 2.18A (Quarterly energy supplement) of this Act to apply. If quarterly energy supplement is payable, then no energy supplement will be available to be included in the total worked out under paragraph 146(4)(a) (see point 1064-C1 of this Act). Note 3: Other effects of this subclause include: (a) the possibility of the minimum amount of fortnightly instalments of the pension being affected under section 43 of the Administration Act; and (b) that section 1210 will affect the operation of reductions of the maximum payment rate because of the income test and assets test.