SUPERANNUATION INDUSTRY (SUPERVISION) ACT 1993

PART 5 - NOTICES ABOUT COMPLYING FUND STATUS  

Division 2 - The Regulator may give notices about complying fund status  

SECTION 42   COMPLYING SUPERANNUATION FUND  

42(1)  
An entity is a complying superannuation fund in relation to a year of income for the purposes of this Division if:


(a) either:


(i) the entity was a resident regulated superannuation fund at all times during the year of income when the entity was in existence; or

(ii) the entity was a resident regulated superannuation fund at all times during the year of income when the entity was in existence other than a time, before it became a resident regulated superannuation fund, when the entity was a resident approved deposit fund; and


(b) either of the following conditions is satisfied:


(i) no trustee of the entity contravened any of the regulatory provisions in relation to the entity in respect of the year of income;

(ii) both:

(A) a trustee of the entity contravened one or more of the regulatory provisions in relation to the entity in respect of the year of income on one or more occasions; and

(B) the entity did not fail the culpability test set out in subsection (1A) in relation to any of those contraventions; and


(c) the entity was not a self managed superannuation fund at any time during the year of income.

42(1AA)  


An entity is also a complying superannuation fund in relation to the 1994-95 year of income or a later year of income if:


(a) the entity:


(i) is a superannuation fund that came into existence during the year of income; or

(ii) was a resident approved deposit fund that became a superannuation fund during the year of income; and


(b) the entity complied with subsections 19(2) to (4) :


(i) within 60 days after the day on which it came into existence or became a superannuation fund, as the case may be; or

(ii) within such further period, if any, as APRA (whether before or after the end of the period of 60 days) allows; and


(c) either of the following conditions is satisfied:


(i) no trustee of the entity contravened any of the regulatory provisions in relation to the entity in respect of the whole of the period (the pre-lodgment period ) that began when the entity came into existence or became a superannuation fund, as the case may be, and ended when the entity complied with subsections 19(2) to (4) ;

(ii) a trustee of the entity contravened one or more of the regulatory provisions in relation to the entity in respect of the pre-lodgment period on one or more occasions but APRA is satisfied that, because of special circumstances that existed in relation to the fund during the pre-lodgment period, it would be reasonable for the fund to be treated as if it had satisfied the regulatory provisions; and


(d) the entity was a resident regulated superannuation fund at all times during the part of the year of income occurring after the end of the pre-lodgment period; and


(da) the entity was not a self managed superannuation fund at any time during the year of income; and


(e) either of the conditions stated in paragraph (1)(b) is satisfied in relation to the entity in respect of the part of the year of income occurring after the end of the pre-lodgment period.

42(1AB)  


In determining for the purpose of paragraph (1AA)(c) whether any of the regulatory provisions were contravened in respect of the entity in respect of the pre-lodgment period, the regulatory provisions are taken to have applied in relation to the entity in respect of that period as if the entity were a resident regulated superannuation fund during that period.

42(1AC)  


An entity is also a complying superannuation fund in relation to the 1994-95 year of income or a later year of income if:


(a) the trustee, or the trustees, of the entity have purported to make an election under subsection 19(4) ; and


(b) the requirements of subsections 19(2) to (4) (to the extent that they have not already been complied with) are complied with within 28 days after a trustee of the entity finds out (whether by written notice from APRA or otherwise) that they were not complied with, or within such further period, if any, as APRA (whether before or after the end of the period of 28 days) allows; and


(c) except where a trustee of the entity received written notice from APRA about the non-compliance - a trustee of the entity tells APRA in writing of the compliance within 7 days after the requirements are complied with or within such further period, if any, as APRA (whether before or after the end of the period of 7 days) allows; and


(d) either of the following conditions is satisfied:


(i) no trustee of the entity contravened any of the regulatory provisions in relation to the entity in respect of the whole of the period (the rectification period ) that began when the trustee, or the trustees, of the entity lodged the purported election under subsection 19(4) and ended when the entity complied with subsections 19(2) to (4) ;

(ii) a trustee of the entity contravened one or more of the regulatory provisions in relation to the entity in respect of the rectification period on one or more occasions but APRA is satisfied that, because of special circumstances that existed in relation to the fund during the rectification period, it would be reasonable for the fund to be treated as if it had satisfied the regulatory provisions; and


(e) if the fund was in existence before the beginning of its 1994-95 year of income - under regulations made for the purposes of section former section 50 (as those regulations were in force as at the beginning of that year of income), the fund is treated as if it had satisfied the transitional superannuation fund conditions at all times during the period that began at the beginning of the fund ' s 1994-95 year of income and ended when the trustee, or the trustees, of the entity lodged the purported election under subsection 19(4) ; and


(f) the entity was a resident regulated superannuation fund at all times during the part of the year of income occurring after the end of the rectification period; and


(fa) the entity was not a self managed superannuation fund at any time during the year of income; and


(g) either of the conditions stated in paragraph (1)(b) is satisfied in relation to the entity in respect of the part of the year of income occurring after the end of the rectification period.

42(1AD)  


In determining for the purpose of paragraph (1AC)(d) whether any of the regulatory provisions were contravened in respect of the entity in respect of the rectification period, the regulatory provisions are taken to have applied in relation to the entity in respect of that period as if the entity were a resident regulated superannuation fund during that period.

42(1A)  


For the purposes of subparagraph (1)(b)(ii), an entity fails the culpability test in relation to a particular contravention of a regulatory provision if:


(a) both:


(i) all of the members of the entity were in any way directly or indirectly knowingly concerned in, or party to, the contravention; and

(ii) the Regulator, after considering:

(A) the taxation consequences that would arise if the entity were to be treated as a non-complying superannuation fund for the purposes of the Income Tax Assessment Act 1997 in relation to the year of income concerned; and

(B) the seriousness of the contravention; and

(C) all other relevant circumstances;
thinks that a notice should be given stating that the entity is not a complying superannuation fund in relation to the year of income concerned; or


(b) all of the following conditions are satisfied:


(i) one or more members of the entity were in any way directly or indirectly knowingly concerned in, or party to, the contravention;

(ii) one or more members of the entity (the innocent members ) were not in any way directly or indirectly knowingly concerned in, or party to, the contravention;

(iii) none of the innocent members would suffer any substantial financial detriment if the entity were to be treated as a non-complying superannuation fund for the purposes of the Income Tax Assessment Act 1997 in relation to the year of income concerned;

(iv) the Regulator, after considering:

(A) the taxation consequences that would arise if the entity were to be treated as a non-complying superannuation fund for the purposes of the Income Tax Assessment Act 1997 in relation to the year of income concerned; and

(B) the seriousness of the contravention; and

(C) all other relevant circumstances;
thinks that a notice should be given stating that the entity is not a complying superannuation fund in relation to the year of income concerned.
Note:

The culpability test is still relevant to a fund that has been a self managed fund during only part of a year of income - see subparagraph 42A(2)(b)(ii) , paragraph 42A(3)(g) and subparagraph 42A(4)(f)(ii) .

42(1B)  
For the purposes of subsection (1A), if there is a question whether a person was in any way directly or indirectly knowingly concerned in, or party to, a particular contravention, that question may be decided on the balance of probabilities.

42(2)  
In this section, a reference to a member of an entity means, if the entity is an approved deposit fund, a beneficiary of the fund.

42(3)  


If a person or body is specified in the regulations for the purposes of subsection 19(4) , a reference to APRA in subparagraph (1AA)(b)(ii) or (c)(ii) or subsection (1AC) of this section is taken to be a reference to that person or body.



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