TTR and Pension
Introduction
In the TTR & Pension menu you can view your clients Transitional Pension or Pension accounts. You can locate these sections by navigating to Modelling > Cashflow & Capital > TTR or Pension.
Note - the TTR page will only appear if you have selected Implement TTR? within the Manage rollovers section of C&C.
In these sections you can manage these pension accounts, their details such as pension payments, income and growth rates and potential tax implications etc.
They each follow a similar lay out to other modules within C&C.
TTR Pension Account
As mentioned above, in order for the TTR module to be visible you need to ensure you have selected to implement TTR as part of the advice within the manage rollovers section.
When you navigate to TTR, you should be presented with a page similar to the below. If this does not include any data, this is likely because you have not included the relevant information into the rollover. Please ensure you return to the Manage rollovers section of C&C and specific the date and amount of money that will be rolled into the TTR.
The module is again broken up into three distinct sections on the page.
- The far right includes a graph of the projected balance of your TTR pension
- The bottom of the page includes a table full of relevant information of the TTR pension per year.
- All changes to your TTR (outside of the initial rollover) are completed in the top left section of this page.
Modifying your TTR
On the page initially you can see the Edit pencil where an additional popup will appear (details below), here you can also set the initial balance of the TTR if your client has an existing one in place and is not part of the advice to open initially.
You can also decide whether you want to set a pension refresh as part of the advice. This will mean that every year the balance of the superannuation account and TTR will be combined and moved into a new TTR. If ticked a new field will appear asking how much money you wish to retain within super at each refresh.
Finally the match net income field will calculate the ideal concessional contributions in order to match pension payments and an overall net income figure unchanged for your client. Any excess above the CC cap will be added as non-concessional contributions.
Additional TTR Edits
When clicking on the Edit (pencil) icon a new pop up will appear as below with additional changes that can be made to your TTR.
You can update standard information such as the name & initial balance, annual fees, tax free component of the balance, as well as the expected return on your investment based on a specific risk profile, portfolio or using override figures.
Pension Payments & Transactions
You can choose from the three following values for pension payments
- Draw minimum each year will select the minimum pension amount based on your clients age
- Set dollar amount will allow you to set a specific dollar amount. This must be done via the Transactions field which is made available only when this payment amount is selected.
- Set percentage amount creates a new field that allows you to set a specific % and you can choose the time period for this.
You can also determine whether the pension is deemed or not, unclicking this field will give you the ability to then complete the centrelink deductible amount.
Match Net Income
As mentioned above, the last button pressed should ideally be the match net income button.
This will calculate the ideal concessional contributions, and if required any excess will be added as non-concessional contributions.
Important Note - the match net income field is a one off calculation. If you make adjustments to any sections in your TTR page it is recommended that you recalculate by clicking this button again. Ideally this should be the last button you press on the TTR page.You will be able to see these figures pre-populated as transactions within Modelling > C&C > Super in the Transactions section as both CC & NCC amounts. These will be drawn from the cashflow amount and will not impact the Default Cash Account balance.
Pension
The Pension section of AdviceOS allows you to manage the account based pensions of your client and partner, who can both hold up to 2 pension accounts if required.
Similar to TTR it is broken down into three distinct sections:
- The far right includes a graph of the projected balance of the selected pension account
- The bottom of the page includes a table full of relevant information of pension account you have selected
- All changes to your pension (outside of the initial rollover) are completed in the top left section of this page using the Pencil icon & Transactions.
Modifying your Pension
Clicking on the Edit (pencil) icon will open up a new popup with a list of fields, allowing you to make changes to your pension account.
Similar to TTRs, you can modify the name of the account, the initial balance (if it's pre-existing - a balance of $0 suggests you will roll money into it at a certain date), the expected return, any relevant fees and the tax free component of the account.
You can determine whether the pension is deemed or not. If not deemed you can include the Centrelink deductible amount and how much of the asset is exempt from the assets test.
Also whether it is a reversionary pension for the spouse and exempt from the assets test.
Payment Type
You can set whether the payment will be a minimum, set dollar or percentage each year.
If you select set dollar amount, you will need to navigate to the Transactions section of the pension to input the amounts manually (see below).
The minimum amount will default to the legislated minimum, while the set percentage amount allows you to set a specific %. Note that the system will not allow you to set a % amount less than the legislated.
Transactions
The transactions field allows you to include any commutations that may be relevant, as well as Pension payments.
Pension Payment
When opening the transaction field you may notice that the pension payment option is not available. In order for this to appear you need to ensure that you have selected a set dollar amount when editting your pension account (see above).
You can complete the left side of the transactions tab with a pension payment value (annual amount) and any relevant indexation, along with a stard and end date.
Alternatively, you can manually add individual figures on the right as either an annual or monthly value.
Commutations
Commutations are quite straight forward, and are one off or ongoing withdrawals from the pension account or additions into the pension account. Similar to other areas of C&C, these can be input annually (which will be evenly spread across all 12 months) or you can select to Show months and choose a specific month the commutation occurs.
Commutations are funds that come from, or are directed to, the cash account.
A negative commutation (such as the -$24,000 above spread over 12 months) indicates a withdrawal from the pension account and will increase the cash balance by $24,000 for that financial year.
A positive commutation (such as the $30,000 one off amount) indicates an addition of funds from the cash account into the pension for modelling purposes.
You can also complete percentage-based withdrawals, however these must be done as a monthly transaction rather than annually. To complete this, include a % sign at the end of the value from 1-100. These values will need to be a negative as they are a withdrawal based on the pension balance.
In the example below, you can see three withdrawals equal to 10% of the balance in Sept 21, 20% of the balance in Oct 22 and finally 100% of the balance in Jan 23.
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