Section D: Income tax calculation statement (item 13)

Mandatory labels

You must complete section D. You must answer questions A, T1, J, T5 and I.

This section works out the amount of tax and other charges payable by, or refundable to, the SMSF. We also use the information which you provide in this section to work out the SMSF's 2022–23 PAYG instalments (if applicable to the SMSF).

Work through each question from A Taxable income to S Amount due or refundable and:

• write the relevant amount if the question applies to your SMSF, or
• write 0 if the question          
  • does not apply to your SMSF, and
  • is one of the mandatory questions (A, T1, J, T5 and I) or
• leave the answer box blank for any other question that does not apply to your SMSF.

Answer the questions in their sequence.

• Some questions rely on information you have already entered in previous questions.
• On page 6 and 7 you will need to go through the questions in the left-hand column (C1–2, D1–4, E1–4, H1–8) before you can complete three questions in the right-hand column (C, D, E, H).

Entitlement to franking credits tax offset

Under the imputation system, tax paid by a company is able to be passed on to its members (shareholders) as a credit (referred to as a franking credit). The member may be able to claim a tax offset for that franking credit (referred to as a franking credits tax offset).

If the SMSF receives dividends with franking credits attached, and none of the exceptions in the following paragraph apply, the SMSF can claim a franking credits tax offset equal to the amount of the franking credit or the SMSF's share of the franking credit.

The SMSF is not entitled to a franking credits tax offset if:

• the SMSF was not an Australian resident
• the SMSF did not satisfy the holding period rule and the related payments rule for the dividend
• the dividend washing integrity rule applies
• there is some other manipulation of the imputation system
• the franking credits are attached to tax exempt dividends (unless they are exempt from income tax under the exempt current pension income rules)
• the franking credits are attached to dividends that are non-assessable non-exempt income.

If the SMSF is entitled to a franking credits tax offset, include the amount of the franking credit (along with the dividend income) at the appropriate question in section B and include the franking credit amount at either:

• E1 Complying fund’s franking credits tax offset if the SMSF is complying, or
• C2 Rebates and tax offsets if the SMSF is non-complying.

A complying SMSF is entitled to a refund if it is unable to fully utilise the tax offset in reducing its income tax whereas a non-complying SMSF is not entitled a refund of the unused portion of a tax offset amount.

13 Calculation statement

In this section, complete labels:

• A, T1, J and B Calculation of gross tax
• A Taxable income
• T1 Tax on taxable income
• J Tax on no-TFN-quoted contributions
• B Gross tax
• C1, C2, C Non-refundable non-carry forward tax offsets
• C1 Foreign income tax offset
• C2 Rebates and tax offsets
• C Non-refundable non-carry forward tax offsets
• T2 Subtotal 1
• D1, D2, D3, D4, D Non-refundable carry forward tax offsets
• D1, D2 Early stage venture capital limited partnership tax offset
• D1 Early stage venture capital limited partnership tax offset
• D2 Early stage venture capital limited partnership tax offset carried forward from previous year
• D3, D4 Early stage investor tax offset
• D3 Early stage investor tax offset
• D4 Early stage investor tax offset carried forward from previous year
• T3 Subtotal 2
• E1, E2, E3 and E4 - E Refundable tax offsets questions
• E1 Complying fund’s franking credits tax offset
• E2 No-TFN tax offset
• E3 National rental affordability scheme tax offset
• E4 Exploration credit tax offset
• E Refundable tax offsets
• T5 Tax payable
• G Section 102AAM interest charge
• H1, H2, H3, H5, H6, H8 and H Eligible credit questions
• H1 Credit for interest on early payments – amount of interest
• H2 Credit for tax withheld – foreign resident withholding (excluding capital gains)
• H3 Credit for tax withheld – where ABN or TFN not quoted (non-individual)
• H5 Credit for TFN amounts withheld from payments from closely held trusts
• H6 Credit for interest on no-TFN tax offset
• H8 Credit for amounts withheld from foreign resident capital gains withholding
• H Eligible credits
• I Tax offset refunds
• K PAYG instalments raised
• L, M and N Supervisory levy questions
• L Supervisory levy
• M Supervisory levy adjustment for wound up funds
• N Supervisory levy adjustment for new funds
• S Amount due or refundable

A, T1, J and B Calculation of gross tax

A Taxable income

You wrote the SMSF's taxable income, or its loss, at O Taxable income or loss in section C.

Is the amount at O Taxable income or loss a loss?

No	Transfer the amount from O Taxable income or loss in section C.
Yes	Write 0 at A. Go to T1.

A is mandatory. If you leave A blank, you will have specified a zero amount.

T1 Tax on taxable income

Is the amount at A zero?

Yes	Write 0 (zero) at T1. Go to J.
No	Read on.

Is the SMSF a complying SMSF for the income year?

No

All assessable income for a non-complying SMSF is taxed at 45%, whether arm's length income, non-arm's length income or arising from a change in the SMSF's tax status. Multiply A by 45%. Write the result at T1.

Yes

Different tax rates apply to arm's length and non-arm's length income. Add 45% of the lesser of (the ‘Lesser of’ calculation): U Net non-arm's-length income (in Section B) plus the total non-arm’s length income that arises due to general expenses (if any) Where, for each general expense, the amount of the non-arm’s length income is calculated as: The difference between the amount of loss, outgoing or expense (revenue or capital in nature) expected to be incurred if the parties had been dealing at arm’s length and the amount of loss, outgoing or expense (revenue or capital in nature) actually incurred (zero if no loss, outgoing or expense was incurred), with the result multiplied by two (the ‘Twice the difference approach' amount) Note: Don't reduce this amount by any deduction, including the amount of general expense actually incurred and the total taxable income for the year written at label O in Section C less any assessable contributions you have written at label R in Section B and adding any deductions against those contributions. 15% of (label A in Section D less the result of the ‘Lesser of’ calculation above). The result is the tax on the SMSF's taxable income before applying rebates, tax offsets, and credits. Write the result at label T1, then go to label J.

Label T1 is mandatory. If you leave label T1 blank, you will have specified a zero amount.

J Tax on no-TFN-quoted contributions

If the SMSF received no-TFN-quoted contributions (recorded at R3 No-TFN-quoted contributions in section B), it pays extra tax on those contributions.

Did the SMSF receive contributions from a member who has not provided their TFN?

No	Write 0 at J. Go to B.
Yes	Read on.

Extra tax applies to no-TFN-quoted contributions. To work out the extra tax, multiply the no-TFN-quoted contributions by:

• 32% if the SMSF is a complying SMSF
• 2% if the SMSF is a non-complying SMSF.

Write the result at J.

All SMSFs, complying and non-complying, have an overall tax rate of 47% on no-TFN-quoted contributions:

• complying SMSFs pay 15% (at T1) and 32% (at J), a total of 47%
• non-complying SMSFs pay 45% (at T1) and 2% (at J), a total of 47%.

You must complete J. If you leave J blank, you specify a zero amount.

B Gross tax

Write at B the total of T1 and J. If the sum is zero, write 0 at B.

 

C1, C2, C Non-refundable non-carry forward tax offsets

Non-refundable non-carry forward tax offsets (if the SMSF is entitled to them) reduce the SMSF's gross tax. If the total of the 'non-refundable non-carry forward' tax offsets is greater than the gross tax, the excess cannot be carried forward and is lost. If the SMSF's gross tax is greater than the total of non-refundable non-carry forward tax offsets, the remaining tax is shown at T2 Subtotal 1.

C1 Foreign income tax offset

Is the SMSF entitled to a foreign income tax offset?

No	Leave C1 blank. Go to C2.
Yes	Read on.

The SMSF may be able to claim a foreign income tax offset where it has paid foreign income tax on an amount included in its assessable income. The SMSF’s foreign income tax offset is limited to the lesser of:

• the foreign income tax that the SMSF paid (or is taken to have paid), and
• the SMSF's foreign income tax offset limit (which is $1,000 or the amount calculated under paragraph 770-75(2)(b) of the ITAA 1997, whichever is greater).

Write at C1 the amount that the SMSF can claim as a foreign income tax offset.

Do not include Australian franking credits from a New Zealand company at C1. Include these at:

• E1 Complying fund’s franking credits tax offset if the SMSF is complying, or
• C2 Rebates and tax offsets if the SMSF is non-complying.

For more information, see Guide to foreign income tax offset rules.

Legislation

Subdivision 770-B of the Income Tax Assessment Act 1997

C2 Rebates and tax offsets

Is the SMSF entitled to rebates and tax offsets (other than those that the SMSF claims at C1, D1 to D4 or E1 to E4?

No	Leave C2 blank. Go to C.
Yes	Read on.

Write at C2 the total of rebates and tax offsets available other than those that are included at C1, D1–4 or at E1–4.

Include franking credits tax offsets at C2 if the SMSF is non-complying. For details on entitlement to a franking credits tax offset, see Entitlement to franking credits tax offset.

You must also include the franking credit as income at the appropriate question in section B.

Do not include:

• franking credits tax offsets if the SMSF is complying (include these at E1 Complying fund’s franking credits tax offset)
• no-TFN tax offsets (include these at E2 No-TFN tax offset)
• franking credits attributable to a dividend that is excluded from assessable income because family trust distribution tax has been paid
• franking credits tax offsets for foreign (including New Zealand) imputation credits (the SMSF cannot claim these in Australia)
• early stage venture capital limited partnership tax offset (include these at D1 Early stage venture capital limited partnership tax offset and/or D2 Early stage venture capital limited partnership tax offset carried forward from previous year)
• early stage investor tax offset (include these at D3 Early stage investor tax offset and/or D4 Early stage investor tax offset carried forward from previous year).

Legislation

Subsection 67-25(1A) and Division 207 of the Income Tax Assessment Act 1997.

C Non-refundable non-carry forward tax offsets

Write at C the total of C1 Foreign income tax offset and C2 Rebates and tax offsets. If you did not write an amount at C1 or C2, leave C blank.

T2 Subtotal 1

Take C Non-refundable non-carry forward tax offsets away from B Gross tax.

If the answer is:

• positive, write the answer at T2
• zero or negative, write 0 at T2.

If the non-refundable non-carry forward tax offsets are greater than the gross tax, the excess cannot be carried forward and is lost.

 

D1, D2, D3, D4, D Non-refundable carry forward tax offsets

Non-refundable carry forward tax offsets reduce any remaining tax at T2 Subtotal 1. If the total of the non-refundable carry forward tax offsets at D is greater than the remaining tax at T2, the excess may be carried forward to a future income year. If the amount at T2 is greater than the total of the non-refundable carry forward tax offsets at D, the remaining tax is shown at T3 Subtotal 2.

Write at D the total of:

• D1 Early stage venture capital limited partnership tax offset
• D2 Early stage venture capital limited partnership tax offset carried forward from previous year
• D3 Early stage investor tax offset, and
• D4 Early stage investor tax offset carried forward from previous year.

If you did not write an amount at D1, D2, D3 or D4, leave D blank.

The tax offsets shown at D are not refundable.

D1, D2 Early stage venture capital limited partnership tax offset

An SMSF may be able to claim the early stage venture capital limited partnership (ESVCLP) tax offset if one or both of the following applies:

• it is entitled to the ESVCLP tax offset in 2021–22
• it has an amount of unused ESVCLP tax offset carried forward from a previous year.

D1 Early stage venture capital limited partnership tax offset

Is the SMSF entitled to claim an ESVCLP tax offset for contributions made during 2021–22?

No	Leave D1 blank. Go to D2.
Yes	Read on.

The SMSF's 2021–22 ESVCLP tax offset is the sum of its tax offsets based on the SMSF's contributions to the ESVCLP:

• as a limited partner of the ESVCLP, or
• through a partnership or a trust.

The ESVCLP must have become unconditionally registered on or after 7 December 2015.

If the SMSF is a limited partner of an ESVCLP, the SMSF's tax offset is limited to 10% of the lesser of the following:

• the SMSF's total contributions to the ESVCLP during 2021–22 (certain exclusions apply), and
• the SMSF's share (based on the SMSF's interest in the entire capital of the ESVCLP at the end of the current income year) of the sum of eligible venture capital investments made by the ESVCLP during the period starting at the start of the current income year and ending two months after the end of the current income year.

If the SMSF is a partner in a partnership or a beneficiary of a trust which has contributed to an ESVCLP, the SMSF may be entitled to an amount of ESVCLP tax offset. A written notification will be provided by the partnership or trustee of the trust setting out the SMSF's entitlement to this tax offset. If a written notification has not been provided, contact the partnership or the trustee.

Write the total amount of the 2021–22 ESVCLP tax offset at D1.

For more information on the ESVCLP tax offset and the eligibility requirements, see ESVCLP tax incentives and concessions.

D2 Early stage venture capital limited partnership tax offset carried forward from previous year

Does the SMSF have an amount of unused ESVCLP tax offset carried forward from a previous year?

No	Leave D2 blank. Go to D3.
Yes	Read on.

To work out whether the SMSF can carry forward an amount of ESVCLP tax offset from a previous year to 2021–22, see Division 65 of the ITAA 1997.

The unused ESVCLP tax offset carried forward from a previous year may need to be adjusted for any net exempt income.

The unused ESVCLP tax offset carried forward from a previous year is reduced by 30 cents for every dollar of unused net exempt income, provided the SMSF had taxable income for that year.

Write at D2 the amount of unused ESVCLP tax offset carried forward from the previous year, less any reductions, if applicable.

For more information, see ESVCLP tax incentives and concessions.

Legislation

Subdivision 61-P of the Income Tax Assessment Act 1997.

D3, D4 Early stage investor tax offset

An SMSF may be entitled to the early stage investor tax offset for the income year if the fund:

• invested in an early stage innovation company during the year, or
• has an amount of unused early stage investor tax offset carried forward from a previous year.

The maximum offset (including current year and carried forward prior year amounts) that the fund, and its affiliates combined, can claim in 2021–22 is $200,000.

D3 Early stage investor tax offset

Is the SMSF entitled to claim an early stage investor tax offset in 2021–22?

No	Leave D3 blank. Go to D4.
Yes	Read on.

Step 1: Work out the total amount the SMSF paid for eligible shares in early stage innovation companies in 2021–22.

If the requirements of the 'sophisticated investor' test under the Corporations Act 2001 are not met for at least one of the investments in an early stage innovation company during 2021–22, the step 1 amount must not exceed $50,000. If the step 1 amount exceeds $50,000 the SMSF cannot claim this offset.

Step 2: Multiply the step 1 amount by 20%.

Step 3: Identify the SMSF's entitlements to any early stage investor tax offsets as a beneficiary of a trust or a partner in a partnership that has invested in an early stage innovation company in 2021–22.

If the SMSF is a partner in a partnership or a beneficiary of a trust which has invested in an early stage innovation company during 2021–22, the SMSF may be entitled to an early stage investor tax offset. A written notification will be provided by the partnership or trustee of the trust setting out the SMSF's entitlement to this tax offset. If a written notification has not been provided, contact the partnership or the trustee.

Step 4: Add together the amounts at step 2 and step 3. This is the step 4 amount.

Step 5: Subtract from $200,000 the amount (if any) reported at D4 Early stage investor tax offset carried forward from previous year. This result is the step 5 amount.

Step 6: If the step 4 amount is equal to or less than the step 5 amount, write the step 4 amount at D3.

If the step 4 amount is greater than the step 5 amount, write the step 5 amount at D3.

The amount reported at D3 may need to be further reduced if any of the SMSF’s affiliates are entitled to the early stage investor tax offset (whether for investments they made in 2021–22 or carried forward from a previous year).

The maximum offset (including current year and carried forward prior year amounts) that the SMSF, and its affiliates combined, can claim in 2021–22 is $200,000.

D4 Early stage investor tax offset carried forward from previous year

Does the SMSF have an amount of unused early stage investor tax offset carried forward from a previous year?

No	Leave D4 blank. Go to D.
Yes	Read on.

To work out whether the SMSF can carry forward an amount of the early stage investor tax offset from a previous year to 2021–22, see Division 65 of the Income Tax Assessment Act 1997.

The unused early stage investor offset carried forward from a previous year may need to be adjusted for any net exempt income.

The unused early stage investor tax offset carried forward from a previous year is reduced by 30 cents for every dollar of unused net exempt income, provided the SMSF had taxable income for that year.

Write at D4 the amount of unused early stage investor tax offset carried forward from the previous year, less any reductions, if applicable.

For more information on the early stage investor tax offset and the eligibility requirements, see Tax incentives for early stage investors.

Legislation

• Division 65 of the Income Tax Assessment Act 1997.
• Subdivision 360-A of the Income Tax Assessment Act 1997.

T3 Subtotal 2

Take D Non-refundable carry forward tax offsets away from T2 Subtotal 1.

If the answer is:

• positive, write the answer at T3
• zero or negative, write 0 at T3.

If the non-refundable carry forward tax offsets are greater than the subtotal at T2, the excess may be carried forward and applied in a later income year.

E1, E2, E3 and E4 - E Refundable tax offsets questions

If the SMSF is entitled to any refundable tax offsets, the offsets reduce any remaining tax at T3 Subtotal. If the amount of refundable tax offsets exceeds the remaining tax at T3, show the excess at I Tax offset refunds. If the amount of refundable tax offsets is less than the remaining tax at T3 the shortfall becomes the tax payable amount at T5.

E1 Complying fund’s franking credits tax offset

For details on entitlement to a franking credits tax offset, see Entitlement to franking credits tax offset.

Is the SMSF entitled to a complying fund's franking credits tax offset?

No	Leave E1 blank. Go to E2.
Yes	Read on.

Write the franking credits tax offsets at E1.

You must also include the franking credits as income at the appropriate question in section B.

Include at E1 Australian franking credits that are attached to:

• dividends and non-share dividends including where they are exempt current pension income
• a New Zealand franking company's          
  • franked non-share dividends, and
  • assessable franked dividends.

Do not include:

• franking credits if the SMSF is non-complying (include these at C2 rebates and tax offsets)
• credits that you included at C1 Foreign income tax offset
• franking credits attributable to a dividend that is excluded from assessable income because family trust distribution tax has been paid
• New Zealand imputation credits (an Australian resident cannot claim New Zealand imputation credits).

Legislation

Section 67-25 and Division 207 of the Income Tax Assessment Act 1997.

E2 No-TFN tax offset

An SMSF is entitled to a no-TFN tax offset in 2021–22 if:

• it was required to pay extra tax on no-TFN-quoted contributions in any of the previous three income years, and
• the no-TFN-quoted contributions were for a member who gave their TFN to the SMSF for the first time in 2021–22.

Is the SMSF entitled to a no-TFN tax offset?

No	Leave E2 blank. Go to E3.
Yes	Read on.

Write the no-TFN tax offset at E2.

The amount of no-TFN tax offset that the SMSF can claim is the total of the additional no-TFN-quoted contributions tax (see J Tax on no-TFN-quoted contributions) that the SMSF was required to pay:

• in any of the three previous income years
• for members who gave their TFN to the SMSF for the first time in 2021–22.

Because SMSF members are generally either trustees of the SMSF, or directors of a corporate trustee, it is very rare for an SMSF to pay no-TFN-quoted contributions tax, and therefore very rare for SMSFs to be entitled to a no-TFN tax offset. Penalties may apply if you claim a no-TFN tax offset that the SMSF is not entitled to.

Legislation

Section 67-23 and Subdivision 295-J of the Income Tax Assessment Act 1997.

E3 National rental affordability scheme tax offset

Is the SMSF entitled to a national rental affordability scheme (NRAS) tax offset?

No	Leave E3 blank. Go to E4.
Yes	Read on.

Write the NRAS tax offset at E3.

The refundable tax offset is only available when the Secretary of the Department of Social Services has issued a certificate under the NRAS. In order to claim the tax offset in the 2021–22 SMSF annual return, the NRAS certificate must relate to the NRAS year 1 May 2021 to 30 April 2022.

For more information, see:

• National rental affordability scheme – taxation issues
• Section 67-23 and Division 380 of the Income Tax Assessment Act 1997.

E4 Exploration credit tax offset

Is the SMSF entitled to an exploration credit tax offset?

No	Leave E4 blank. Go to E.
Yes	Read on.

Write the exploration credit tax offset at E4.

An SMSF may be entitled to a tax offset for exploration credits received during the income year if it was an Australian resident for the whole of the income year.

The amount of the tax offset is the total value of exploration credits the SMSF received in the income year. However, special rules may apply where the SMSF has received exploration credits from a partnership or a trust.

For more information, see:

• Exploration Development Incentive
• Division 418 of the Income Tax Assessment Act 1997.

E Refundable tax offsets

Write at E the total of:

• E1 Complying fund's franking credits tax offset
• E2 No-TFN tax offset
• E3 National rental affordability scheme tax offset, and
• E4 Exploration credit tax offset.

The tax offsets reduce the tax that remains at T3 Subtotal. If the amount of refundable tax offsets at E:

• is less than the tax at T3, the shortfall becomes the SMSF's tax payable amount at T5 Tax payable
• is greater than the tax at T3, show the excess at I Tax offset refunds.

T5 Tax payable

T5 is mandatory. If you leave T5 blank, you will have specified a zero amount.

Is the amount at T3 Subtotal more than the amount at E Refundable tax offsets?

No	Write 0 (zero) at T5. Take T3 Subtotal away from E Refundable tax offsets. Write the result at I Tax offset refunds.
Yes	Take E Refundable tax offsets away from T3 Subtotal. Write the result at T5.

 

G Section 102AAM interest charge

An interest charge is imposed on certain distributions from non-resident trusts under section 102AAM of the Income Tax Assessment Act 1936.

Is the SMSF required to pay a Section 102AAM interest charge?

No	Leave G blank.
Yes	Write at G the Section 102AAM interest charge that the SMSF is required to pay.

H1, H2, H3, H5, H6, H8 and H Eligible credit questions

If the SMSF is entitled to any credits for tax or TFN amounts withheld or for interest, the total eligible credits are available as a credit amount in the overall calculation. If the amount of eligible credits exceeds the tax payable and the levy amount then the SMSF may be entitled to a refund of the excess.

H1 Credit for interest on early payments – amount of interest

Is the SMSF entitled to interest on early payments made to the ATO?

No	Leave H1 blank. Go to H2.
Yes	Read on.

Write at H1 the calculated interest amount of 50 cents or more for early payments.

Do not write the amount of the early payment at H1.

We may pay interest where the SMSF paid certain amounts more than 14 days before the due date of payment. Amounts that may attract early payment interest include payments of:

• income tax
• shortfall interest charge
• interest payable under section 102AAM of the ITAA 1936.

Amounts that you do not pay directly to us, but which are reduced by the crediting or applying of an amount, do not attract early payment interest. These amounts include:

• credit for instalments payable under the PAYG instalment regime
• credit for amounts withheld from withholding payments under the PAYG withholding regime
• an overpayment of other income tax liabilities
• a running balance account (RBA) surplus, and
• any other credit entitlement arising under a tax law.

Early payment interest is not payable on any part of the payment that:

• exceeds the amount due,
• attracts interest on overpayment under Part IIIA of the TIOEPA 1983.

Early payment interest is also not payable on the Supervisory Levy.

Early payment interest is calculated from the date the early payment is made to the date the amount becomes due and payable. However, if you pay an amount early on account of a tax liability, and we refund it before the due date of the liability, interest will not accrue for the period after the date on which we refund the amount.

Date of payment is either:

• the date shown on the receipt
• the date the payment is mailed to us plus three business days, or
• the date shown on the SMSF’s bank statement if payment is made through direct debit, that is, electronic funds transfer (EFT).

Table 8: Interest on early payments

The rates of interest on early payments for 2021–22 are:

Quarter	Interest rate (pa) %
Jul–Sep 2021	0.04
Oct–Dec 2021	0.01
Jan–Mar 2022	0.04
Apr–Jun 2022	0.07

If the early payment extends over two or more quarters, calculate the interest for the number of days in each quarter.

For 2021–22 interest is calculated as follows:

Interest = (number of days ÷ 365) × amount of payment for that quarter × interest rate (for that quarter)

You cannot claim a credit for interest of less than 50 cents on early payments.

Keep a record of the amount of the early payment interest payable. This interest is assessable income in the income year in which it is paid to the SMSF or credited against another SMSF liability.

To work this out, see the Credit for interest on early payments calculator.

H2 Credit for tax withheld – foreign resident withholding (excluding capital gains)

Is the SMSF entitled to a credit for tax withheld through foreign resident withholding in Australia?

No	Leave H2 blank. Go to H3.
Yes	Read on.

Do not include credits for amounts withheld from foreign resident capital gains withholding at H2. Include these at H8 Credit for amounts withheld from foreign resident capital gains withholding.

Write at H2 the total amount of tax withheld from payments to the SMSF that were subject to foreign resident withholding in Australia. Include at H2 the SMSF’s share of foreign resident withholding credits distributed to the SMSF from a partnership or included in a share of net income from a trust.

If a payer has withheld tax for foreign resident withholding from a payment to the SMSF, the payer must give the SMSF a payment summary that shows how much the payer withheld from its payments to the SMSF.

If you claim a credit at H2:

• you must include the corresponding gross payment at the appropriate item in section B
• you must complete a Non-individual PAYG payment summary schedule 2022.

The SMSF is entitled to a credit at H2 only if the amount was:

• withheld in Australia, and
• remitted to us.

For more information, see PAYG withholding.

H3 Credit for tax withheld – where ABN or TFN not quoted (non-individual)

Is the SMSF entitled to credits for tax withheld where it didn't quote its Australian business number (ABN) or tax file number (TFN)?

No	Leave H3 blank. Go to H5.
Yes	Read on.

Write at H3 the total tax withheld from payments to the SMSF because the SMSF had not quoted its ABN or TFN.

If a payer has withheld tax from a payment to the SMSF because the SMSF did not quote its ABN or TFN, the payer must give the SMSF a payment summary that shows how much tax was withheld.

Do not include at H3:

• contributions that the SMSF received for a member who has not quoted their TFN (include these at R3 No-TFN-quoted contributions in section B)
• amounts withheld from payments because the SMSF did not provide its TFN to the trustee of a closely held trust (include these at H5).

If you claim a credit at H3:

• you must include the corresponding gross payment at the appropriate item in section B
• complete a Non-individual PAYG payment summary schedule 2022.

For more information, see PAYG withholding.

H5 Credit for TFN amounts withheld from payments from closely held trusts

Is the SMSF entitled to credits for TFN amounts withheld from payments from closely held trusts?

No	Leave H5 blank. Go to H6.
Yes	Read on.

Write at H5 the total tax withheld from payments where the SMSF has not provided its TFN to the trustee of a closely held trust and the payment is subject to the TFN withholding rules.

If a closely held trust has withheld tax from a payment to the SMSF because the SMSF did not provide its TFN, the closely held trust must give the SMSF a payment summary that specifies how much it withheld from its payments to the SMSF.

If you claim a credit at H5:

• the corresponding gross payment must be included at the appropriate item in section B)
• you must complete a Non-individual PAYG payment summary schedule 2022.

For more information, see TFN withholding for closely held trusts.

H6 Credit for interest on no-TFN tax offset

Is the SMSF entitled to interest on no-TFN tax offsets?

If the SMSF has not claimed a no-TFN tax offset at E2, it cannot claim a credit at H6.

No	Leave H6 blank. Go to H8.
Yes	Read on.

Write at H6 the total calculated interest amount of 50 cents or more for interest payable on the no-TFN tax offset claimed at E2 No-TFN tax offset. Do not include no-TFN tax offsets at H6 (include these offsets at E2 No-TFN tax offset).

Interest on the no-TFN tax offset is only payable if all the following occurred:

• the member of the SMSF provided their TFN to their employer before the end of a past income year
• the employer was required by section 299C of the Superannuation Industry (Supervision) Act 1993 (SISA) to inform the SMSF of the individual’s TFN by the end of the year, but did not do so
• contributions made for that member were no-TFN-quoted contributions in that past income year and the SMSF was required to pay additional tax (which is the interest bearing tax) on those contributions
• the SMSF claimed a no-TFN tax offset in 2021–22 for the additional tax paid on those no-TFN-quoted contributions in a past income year
• the no-TFN tax offset is applied when assessing the SMSF for 2021–22.

The rate of interest payable on the interest-bearing tax is the base interest rate determined under section 8AAD of the Taxation Administration Act 1953 (TAA). Table 8 at H1 Credit for interest on early payments – amount of interest provides the applicable interest rates for 2021–22.

Keep a record of the amount of interest payable on tax that counts towards the no-TFN tax offset. This interest is assessable income of the SMSF in the income year in which it is paid to the SMSF or credited against another SMSF liability.

For more information, see Interest on no-TFN quoted tax offset.

H8 Credit for amounts withheld from foreign resident capital gains withholding

Is the SMSF entitled to a credit for tax withheld through foreign resident capital gains withholding in Australia?

No	Leave H8 blank. Go to H.
Yes	Read on.

Write at H8 the total amount of tax withheld from payments to the SMSF that were subject to foreign resident capital gains withholding in Australia. Include at H8 the SMSF’s share of foreign resident capital gains withholding credits distributed to the SMSF from its share of net income from a trust.

You should only claim at H8 a credit equal to the amount of foreign resident capital gains withholding paid by a purchaser to the ATO on your behalf. The ATO would have issued you with confirmation of this amount.

Do not include credits for amounts withheld from foreign resident withholding at H8. Include these at H2 Credit for tax withheld – foreign resident withholding.

For more information, see Capital gains withholding: Impacts on foreign and Australian residents.

H Eligible credits

Is there an amount at:

• H1 Credit for interest on early payments – amount of interest
• H2 Credit for tax withheld – foreign resident withholding
• H3 Credit for tax withheld – where ABN or TFN not quoted (non-individual)
• H5 Credit for TFN amounts withheld from payments from closely held trusts
• H6 Credit for interest on no-TFN tax offset
• H8 Credit for amounts withheld from foreign resident capital gains withholding?

No	Leave H blank.
Yes	Write at H the total of the amounts at H1, H2, H3, H5, H6 and H8.

I Tax offset refunds

Is the amount at T3 Subtotal less than the amount at E Refundable tax offsets?

No	Write 0 (zero) at I. Go to K.
Yes	Read on.

Take T3 Subtotal away from E Refundable tax offsets. Write the result at I.

See the examples at T5 Tax payable showing the calculation of I Tax offset refunds.

T5 is mandatory. If you leave T5 blank, you will have specified a zero amount.

K PAYG instalments raised

Did the SMSF pay, or was it required to pay, PAYG instalments for 2021–22?

No	Leave K blank. Go to L.
Yes	Read on.

Write at K the total of the SMSF’s PAYG instalments for 2021–22, whether or not the PAYG instalments have actually been paid.

You can find the SMSF's PAYG instalment amounts on its activity statements.

If the SMSF used the instalment amounts worked out by us, its PAYG instalment amounts were pre-printed at:

• T7 on the SMSF’s quarterly activity statements, or
• T5 on the annual instalment activity statement.

If the SMSF did not use the instalment amounts worked out by us, work out its PAYG instalment amounts by subtracting the credits claimed at 5B from the amounts reported at 5A on its activity statements.

To ensure the SMSF receives the correct amount of credit for its PAYG instalments, make sure all of its activity statements are finalised before lodging the annual return. If the SMSF is required to lodge its activity statements, it should do so even if it can’t pay on time, or has nothing to pay.

The SMSF is entitled to a credit for its PAYG instalments even if it has not actually paid a particular instalment. However, the SMSF will be liable for the general interest charge on any outstanding instalment for the period from the due date for that instalment until the date it is fully paid.

You must exclude the SMSF's exempt current pension income from the amount you write at T1 PAYG instalment income on the PAYG activity statement if you use the instalment rate method to calculate your SMSF's PAYG instalments. See PAYG instalments.

L, M and N Supervisory levy questions

L, M and N are used to calculate the amount of SMSF supervisory levy that the SMSF must pay with the 2022 SMSF annual return. The amount that you must write at each of these questions depends on whether the SMSF was:

• an existing SMSF at the start of 2021–22 and was not wound up in 2021–22
• a newly registered SMSF in 2021–22 and its first SMSF annual return is for 2021–22
• wound up during 2021–22
• both newly registered and wound up during 2021–22.

Table 9 shows the amounts you must write at M and N. L is already completed.

Table 9: Supervisory levy amounts

Type of SMSF	Amount at L $	Amount at M $	Amount at N $	Net amount (L−M+N) $	Comment
Existing SMSF that was not wound up in 2021–22	259	0 or blank	0 or blank	259	The SMSF supervisory levy amount is for 2022–23.
Newly registered SMSF in 2021–22 that was not wound up in 2021–22	259	0 or blank	259	518	The SMSF supervisory levy amount is for 2021–22 and 2022–23.
Newly registered SMSF in 2021–22 that was wound up in 2021–22	259	0 or blank	0 or blank	259	The SMSF supervisory levy amount is for 2021–22.
Existing SMSF that was wound up in 2021–22	259	259	0 or blank	0	No SMSF supervisory levy is due.

L Supervisory levy

L shows the amount of supervisory levy due for 2022–23 ($259). Do not change the amount printed on the annual return.

The supervisory levy is included in the SMSF’s tax assessment calculation and is to be paid with its income tax liability. The levy is payable even if the SMSF has no tax liability 2021–22.

For more information, see Superannuation (Self-Managed Superannuation Funds) Supervisory Levy Imposition Act 1991External Link.

M Supervisory levy adjustment for wound up funds

Was the SMSF wound up in 2021–22?

No	Leave M blank. Go to N.
Yes	Write $259.00 at M. Make sure you answered Yes in section A at 9 Was the fund wound up during the income year?

An SMSF which was wound up during 2021–22 does not pay the SMSF supervisory levy for 2022–23. Writing $259 at M reduces the levy payable by $259 since the amount that you write at M will be subtracted when you calculate S Amount due or refundable.

N Supervisory levy adjustment for new funds

Is this the first annual return for a newly registered SMSF?

No	Leave N blank. Go to S.
Yes	Write $259.00 at N. Make sure you answered Yes to 5B Is this the first required return for a newly registered SMSF? in section A.

The amount at N is the SMSF supervisory levy for 2021–22. SMSFs that are lodging their first annual return have not paid this amount previously while the other SMSFs paid the SMSF supervisory levy for 2021–22 with their 2021 SMSF annual return.

For more information, see SMSF supervisory levy – 2013 to 2021 financial years.

S Amount due or refundable

To work out S:

• add          
  • T5 Tax payable
  • G Section 102AAM interest charge
  • L Supervisory levy
  • N Supervisory levy adjustment for new funds
• and then subtract          
  • H Eligible credits
  • I Tax offset refunds
  • K PAYG instalments raised
  • M Supervisory levy adjustment for wound up funds.

S Amount due or refundable can be zero, positive or negative:

• a positive amount is what you must pay to us
• a negative amount is the refund that you will receive.

If the amount at S is negative, write '–' to the left of the amount that you printed at S.

If the amount at S is negative, complete 7 Electronic Funds Transfer in section A to receive the refund.

If the SMSF has made any interim or voluntary payments against its 2021–22 tax liability:

• do not take the payments into account when working out the amount at S
• take the payments into account when working out the amount you must pay to us.

Do not attach any payment to the annual return.

For more information, see Payment.

Record keeping

The SMSF must keep:

• all documentation issued by financial institutions detailing          
  • payments of income
  • any TFN amounts deducted from those payments
• details of any TFN amounts deducted from the SMSF's income payments and subsequently refunded to the SMSF by the financial institution.

Where an amount is refunded the SMSF must keep details of the:

• amount of refund
• date of refund
• investment reference number, for example, the bank account number of the investment relating to the refund.

Continue to: Section E: Losses (item 14)