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Edited version of private advice

Authorisation Number: 1051835860382

Date of advice: 28 May 2021

Ruling

Subject: Personal superannuation contribution deduction

Question 1

Are the personal super contributions of an amount you made to Fund A in the 2019-20 income deductible under section 290-150 of the Income Tax Assessment Act 1997 (ITAA 1997)?

Answer

Yes

Question 2

Are the personal super contributions of an amount you made to Fund B in the 2019-20 income deductible under section 290-150 of the ITAA 1997?

Answer

No

This ruling applies for the following period:

1 July 2019 to 30 June 2020

The scheme commences on:

1 July 2019

Relevant facts and circumstances

1.            You are self-employed.

2.            During the 2019-20 income year, you made total personal super contributions to your superannuation funds of an amount. Of this total you made personal super contributions as follows:

a.    an amount made to Fund A; and

b.    an amount made to Fund B.

3.            You had tax deducted on the personal super contributions of an amount made to Fund A in the 2019-20 income year.

4.            You had tax deducted on the personal super contributions of an amount made to Fund B in the 2019-20 income year.

5.            During the 2019-20 income year you rolled over an amount of Fund B to another super fund, and the remaining balance of an amount was rolled over to another super fund.

6.            You were a member of Fund A for the whole of the 2019-20 income year.

7.            During 2020 Fund A issued you an acknowledgment notice confirming your notice of intent to claim a personal super contribution deduction of an amount for the 2019-20 income year.

8.            You advise that you did not provide Fund B with a notice of intent to claim a personal super contribution deduction prior to rolling over the whole balance to other super funds.

9.            You advise Fund B will not accept a notice of intent to claim a personal super contribution deduction as you are no longer a member of the fund.

10.          You are unaware of the strict timeframe required by legislation to lodge a valid notice of intent to claim a deduction.

Relevant legislative provisions

Income Tax Assessment Act 1997 Section 290-150.

Income Tax Assessment Act 1997 Subsection 290-150(2).

Income Tax Assessment Act 1997 Section 290-170.

Income Tax Assessment Act 1997 Subsection 290-170(1).

Income Tax Assessment Act 1997 Subsection 290-170(2).

Reasons for decision

Summary

11.          Your notice of intent to claim a deduction, for personal contributions made to Fund B in the 2019-20 income year, was made within the timeframe required by legislation. The notice met the required timeframe as it was lodged at the end of the 2019-20 income year.

12.          You did not make a valid notice of intent to claim a deduction, for personal contributions made to Fund B in the 2019-20 income year, within the timeframe required by legislation. There was no notice lodged at the end of the 2019-20 income year.

13.          Further, the Commissioner does not have the power to exercise discretion to grant an extension of time for a person to lodge a notice of intent. As such, you cannot claim a deduction for personal contributions made to Fund B fund in the 2019-20 income year.

Detailed Reasoning

Deductions for personal superannuation contributions

14.          A person must satisfy the conditions in section 290-150 of the ITAA 1997 before they can claim a deduction in respect of personal contributions made for the purpose of providing superannuation benefits for themselves, or their dependants after their death.

15.          Further, subsection 290-150(2) of the ITAA 1997 provides that the conditions in sections 290-155, 290-160 (if applicable), 290-165 and 290-170 must all be satisfied before the person can claim a deduction for the contributions made in that income year. These conditions are explained in detail in Taxation Ruling TR 2010/1 entitled 'Income Tax: superannuation contributions'.

Notice of intent to deduct conditions

16.          Section 290-170 of the ITAA 1997 requires a person to provide a valid notice of their intention to claim the deduction to the trustee of their superannuation fund. The notice must be given before the earlier of:

-   the date the person lodges their income tax return for the income year in which the contribution was made; or

-   the end of the income year following the year in which the contribution was made.

17.          In addition, the person must also have been given an acknowledgement of the notice by the trustee of the superannuation fund.

18.          You made personal contributions of an amount in the 2019-20 income year to Fund A.

19.          During the 2019-20 income year Fund A issued you an acknowledgment notice confirming your notice of intent to claim a personal super contribution deduction of an amount for the 2019-20 income year

20.          You also made personal contributions of an amount in the 2019-20 income year to Fund B.

21.          During the 2019-20 income year you rolled over an amount of Fund B to another super fund, and the remaining balance of an amount was rolled over to another super fund.

22.          You did not provide Fund B with a notice of intent to claim a personal super contribution deduction prior to rolling over the whole balance to other super funds and prior to the end of the 2019-20 income year.

23.          In light of the foregoing, it is evident that the notice of intent to deduct requirement under section 290-170 of the ITAA 1997 has not been met with respect to personal contributions made to Fund B.

A deduction is not allowable for your personal contribution

24.          As noted earlier, the conditions in sections 290-155, 290-160 (if applicable), 290-165 and 290-170 of the ITAA 1997 must all be satisfied before a person can claim a deduction for the contributions made in that income year.

25.          As noted above, the requirements of section 290-170 of the ITAA 1997 were not met.

26.          Consequently, you are not entitled to claim a deduction in respect of the personal contributions of an amount made to the Fund B in the 2019-20 income year.

Discretion

27.          Section 290-170 of the ITAA 1997 does not give the Commissioner the power to exercise discretion to allow a deduction where any of the requirements of this provision have not been satisfied, regardless of the reasons those requirements were not met, or the extent to which those reasons were beyond a taxpayer's control.

28.          The Commissioner also does not have the power to exercise discretion to grant an extension of time for a person to lodge a notice of intent under section 290-170.

Conclusion

29.          As the notice of intent to deduct conditions have been satisfied, the personal contributions you made to Fund A during the 2019-20 income year are deductible under section 290-150 of the ITAA 1997.

30.          As the notice of intent to deduct conditions have not been satisfied, the personal contributions you made to Fund B during the 2019-20 income year are not deductible under section 290-150 of the ITAA 1997.