In the decision of QWYN and Commissioner of Taxation (Taxation and business) [2025] ARTA 83 the Administrative Review Tribunal (ART) has determined that regular disability payments described as a superannuation income stream was a superannuation income stream for tax purposes and not a number of (more tax concessionally treated) disability lump sums.

The ART considered the second limb of the definition of income stream in the Income Tax Assessment Regulations 1997 which defined an income stream to be a pension within the meaning of the Superannuation Industry (Supervision) Act 1993 (SIS Act) that commenced before 20 September 2007 (as was the case here).

Section 10(1) of the SIS Act defines a pension to include a benefit taken to be a pension for the regulations (such as an account based pension). The ART determined that this inclusive the definition, not only includes those pensions defined in the regulations, but would also include pensions under their ordinary meaning. That is it included pensions even if they didn’t meet the criteria of the regulations (as was the case here).

Therefore, here, the ART found the relatively fixed and regular payments received by the taxpayer from his disability payments from the super fund were a pension in accordance with the ordinary meaning of that term.

Further challenge to the ATO’s views on pensions

The taxpayer’s circumstances were relatively unique and therefore the direct relevance of this decision will be limited.

However, it does raise a further question on the ATO’s view of pensions and, in particular, the ATO’s view that pensions cease as a result of failure to make minimum pensions (as discussed here).

That is, here, the ART has confirmed that pensions have a common law meaning outside of that of the superannuation regulations. Such pensions will not cease if a minimum pension is not paid in a particular year.

Interesting aside – ART “slaps down” applicant for quoting AI hallucination

In a very topical point, the ART expressed its displeasure at the self-represented taxpayer applicant for preparing incorrect submissions using Microsoft’s artificial intelligence program Copilot. The ART tersely noted that the applicants submissions referred to paragraphs in an explanatory memorandum that didn’t exist.

Phil Broderick
Principal
T +61 3 9611 0163 l M +61 419 512 801
E pbroderick@sladen.com.au

Philippa Briglia
Special Counsel
T +61 3 9611 0174 | M +61 449 404 801
E: pbriglia@sladen.com.au