Superannuation funds
Income or positive returns that are locked into a superannuation scheme registered as a managed investment scheme under the Financial Markets Conduct Act 2013 will not be considered personal income for Student Allowance purposes.
A qualifying lock-in clause prevents a member of the scheme from receiving a withdrawal from the scheme until the member:
- reaches the stated time of retirement or
- leaves the employment which established the scheme
Example
Income earned in a KiwiSaver account will not be considered personal income while the funds are locked in.
When a student or their partner reaches the age of 65 they may be able to withdraw their funds from their KiwiSaver account.
At that point any income from the scheme should be included as personal income; including interest generated from funds invested.
Significant lump sums deposited in a superannuation scheme account
Depositing significant lump sum funds into a superannuation scheme may be considered deprivation of income.
This depends on factors such as the size and frequency of those deposits and the individual circumstances of the client.
Deprivation will affect entitlement to Student Allowances if MSD considers that these sums were deposited into a superannuation scheme in order to qualify for a Student Allowance or a higher rate of allowance.
Each case needs to be considered on its merits and you should seek advice from the StudyLink Business Support team or Legal Services before any decisions are made.
For more information about Deprivation of Income see:
Legislation
- Deprivation of income regulation 44 Student Allowances Regulations 1998
