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  • Advice under development – superannuation issues

    We are developing advice and guidance on the following superannuation issues.

    See also

    [3938] Superannuation income stream

    Title
    Addendum to Taxation Ruling TR 2013/5
    Income tax: when a superannuation income stream commences and ceases

    Purpose
    TR 2013/5 has been impacted by the legislative amendments flowing from the 2016 Budget announcement of the transfer balance cap, which limits the superannuation interests that a person can have in retirement phase. The Addendum will update the legislative references in the Ruling as a result of these amendments as well as address other amendments – including to the definition of superannuation income stream benefit.

    Expected completion
    To be advised

    Comments
    Completion of this Addendum has been delayed to enable further consideration of issues relating to reversionary pensions.

    Contact
    PAGSEO@ato.gov.au

    [3971] Self-managed super funds – rectification directions

    Title
    Final Law Administration Practice Statement
    Rectification direction for contraventions to the Superannuation Industry (Supervision) Act 1993

    Purpose
    This final practice statement will provide guidance to ATO staff on the relevant matters to be considered when deciding whether to give a trustee or a director of a body corporate that is a trustee of a self-managed super fund a written rectification direction under section 159 of the Superannuation Industry (Supervision) Act 1993.

    Expected completion
    To be advised

    Contact
    PAGSEO@ato.gov.au

    [3972] Self-managed super funds – education directions

    Title
    Final Law Administration Practice Statement
    Education direction for contraventions of the Superannuation Industry (Supervision) Act 1993

    Purpose
    This final practice statement will provide guidance to ATO staff on the relevant matters to be considered when deciding whether to give a trustee or a director of a body corporate that is a trustee of a self-managed super fund a written education direction under section 160 of the Superannuation Industry (Supervision) Act 1993.

    Expected completion
    To be advised

    Contact
    PAGSEO@ato.gov.au

    [3975] Super benefits in breach of rules

    Title
    Draft Law Administration Practice Statement
    Exercising the Commissioner’s discretion where superannuation benefits are received in breach of legislative requirements

    Purpose
    This draft Practice Statement will provide guidelines on the Commissioner's discretion as set out in subsection 304-10(4) of the Income Tax Assessment Act 1997, which may be applied where superannuation benefits are received in breach of legislative requirements.

    Expected completion
    Mid/late 2021

    Contact
    PAGSEO@ato.gov.au

    Title
    Draft Taxation Determination
    Income tax: how will a superannuation benefit be treated for income tax purposes where the Commissioner determines it would be unreasonable for it to be included in an individual’s assessable income under subsection 304-10(4) of the Income Tax Assessment Act 1997?

    Purpose
    This draft Determination will set out the Commissioner’s preliminary view on the income tax treatment of a superannuation benefit received by an individual otherwise than in accordance with the payment standards prescribed under subsection 31(1) of the Superannuation Industry (Supervision) Act 1993, where the Commissioner exercises the discretion contained in subsection 304-10(4) of the Income Tax Assessment Act 1997.

    Expected completion
    Mid/Late 2021

    Comments
    The draft Determination will complement the proposed publication of a related law administration practice statement on exercising the Commissioner’s discretion where superannuation benefits are received in breach of legislative requirements.

    Contact
    PAGSEO@ato.gov.au

    [3984] Non-arm's length expenditure

    Title
    Final Law Companion Ruling
    Non-arm's length income – expenditure incurred under a non-arm's length arrangement

    Purpose
    This final Ruling will provide the Commissioner’s view of amendments in the Treasury Laws Amendment (2018 Superannuation Measures No 1) Act 2019, concerning the application of the non-arm’s length income provisions where a trustee incurs ‘non-arm’s length expenditure’ under a scheme.

    Expected completion
    July 2021

    Comments
    Draft LCR 2019/D3 published on 2 October 2019. Comments period closed on 15 November 2019. Further targeted external consultation has been undertaken and we have continued to receive submissions.

    We recognise this is an important issue for the SMSF industry and, given the complexity and interest in this issue, we sought additional advice from the Public Advice and Guidance panel in April 2021. As the final Ruling will not be published before June 2021 we updated Practical Compliance Guideline PCG 2020/5 Applying the non-arm's length income provisions to 'non arm's length expenditure' – ATO compliance approach for complying superannuation entities to extend our compliance approach by another 12 months. This means we will not allocate compliance resources to determine whether the non-arm’s length income provisions apply where the super fund incurred non-arm’s length expenditure of a general nature that has a sufficient nexus to all ordinary and/or statutory income derived by the fund in the 2021–22 income year. This transitional approach will not apply where the super fund incurred non-arm’s length expenditure that directly related to the fund deriving particular ordinary or statutory income.

    Contact
    PAGSEO@ato.gov.au

    See also:

    Title
    Draft update to Taxation Ruling TR 2010/1
    Income tax: superannuation contributions

    Purpose
    The draft update to TR 2010/1 will explain the proposed interactions between the non-arm's length income provisions and the rules concerning superannuation contributions.

    Expected completion
    July 2021

    Comments
    The draft update to this Ruling is to be read in conjunction with Draft Law Companion Ruling LCR 2019/D3 Non-arm’s length income – expenditure incurred under a non-arm’s length arrangement. Appendix 2 of this Ruling sets out the Commissioner’s proposed compliance approach for the 2018-19 and later income years in determining when a contribution has been made to the superannuation provider where the non-arm’s length income rules apply.

    The draft update will also contain material to reflect the removal of the maximum earnings test for the purpose of deducting personal contributions, which commenced from 1 July 2017.

    Contact
    PAGSEO@ato.gov.au

    [4002] Self-managed super funds – interests in another entity

    Title
    Draft SMSF Determination
    What constitutes an ‘interest in another entity’ for the purposes of Division 13.3A of Superannuation Industry (Supervision) Regulations 1994 (SISR)?

    Purpose
    This draft Determination is being developed to consolidate and update ATO interpretative decisions ATO ID 2008/51 and ATO ID 2008/52.

    Expected completion
    To be advised

    Contact
    PAGSEO@ato.gov.au

    [4025] Super guarantee – Part 7 penalties

    Title
    Draft Law Administration Practice Statement
    Remission of additional superannuation guarantee charge

    Purpose
    This Practice Statement will outline the Commissioner’s revised approach in relation to the remission of additional super guarantee charge imposed under Part 7 of the Superannuation Guarantee (Administration) Act 1992.

    Expected completion
    July 2021

    Comments
    Law Administration Practice Statement PS LA 2020/4 Remission of additional superannuation guarantee charge was annotated on 21 May 2021, advising that the Commissioner's decision-making principles for the remission of additional superannuation guarantee charge for quarters commencing from 1 April 2018 are currently being reviewed. The principles in PSLA 2020/4 only apply to quarters that were subject to the superannuation guarantee amnesty (quarters ending on 31 March 2018 and earlier).

    The proposed Practice Statement will combine the principles in PS LA 2020/4 with the revised remission principles for quarters commencing from 1 April 2018.

    Contact
    PAGSEO@ato.gov.au

    Last modified: 27 Jul 2021QC 50320