ATO Interpretative Decision
ATO ID 2002/719
Superannuation
Superannuation contributions tax: employer eligible termination payments roll-oversFOI status: may be released
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This ATOID provides you with the following level of protection:
If you reasonably apply this decision in good faith to your own circumstances (which are not materially different from those described in the decision), and the decision is later found to be incorrect you will not be liable to pay any penalty or interest. However, you will be required to pay any underpaid tax (or repay any over-claimed credit, grant or benefit), provided the time limits under the law allow it. If you do intend to apply this decision to your own circumstances, you will need to ensure that the relevant provisions referred to in the decision have not been amended or repealed. You may wish to obtain further advice from the Tax Office or from a professional adviser.
Issue
Is the employer contributed amount (defined benefits) reported by a superannuation provider under subsection 8(4) Superannuation Contributions Tax (Assessment and Collection) Act 1997 (SCT Act) a post-20 August 1996 component of an employer eligible termination payment roll-over as defined under subparagraph 8(2)(c)(iii) of the SCT Act ?
Decision
No. The employer contributed amount (defined benefits) is not a surchargeable contribution as defined under subparagraph 8(2)(c)(iii) of the SCT Act. It is a 'surchargeable contribution' as defined in subsection 8(4) of the SCT Act.
Facts
Under the member's separation agreement with his employer signed in November 1996, the employer agreed to make a contribution to the preserved section of the member's superannuation provider to assist the employee/member in future endeavours and in recognition of past service. The member's account was to be credited with the gross contribution amount inclusive of the 15% contributions tax. The provider reported the contribution amount as an employer contributed amount (defined benefits) for the 1997 financial year. The member stated in his objection request to the Commissioner of Taxation that he did not have the option to take the contribution as a cash payment.
Reasons for Decision
Subsection 13(2) of the SCT Act requires a provider to report to the Commissioner, details of a member's total contributed amounts for a financial year including the member's surchargeable contributions.
Subsection 8(3) of the SCT Act includes as surchargeable contributions for a member of a defined benefits superannuation scheme, amounts that constitute the actuarial value of the benefits and expenses provided in respect of a member for the financial year.
For the 1997 financial year, the surchargeable contributions for a member of a defined benefits provider are calculated by reference to the amount worked out using the formula as set out in subsection 8(4) of the SCT Act.
The member's defined benefits provider reported the member's contributed amount to the Commissioner as an employer contributed amount (defined benefits) for the 1997 financial year. The amount was not reported as a post-20 August 1996 component of an employer ETP roll-over as defined under subparagraph 8(2)(c)(iii) of the SCT Act.
There is no discretion under the SCT Act to allow the Commissioner to exclude an amount reported under subsection 8(4) of the SCT Act from being a surchargeable contribution.
Date of decision: 22 June 1998
Legislative References:
Superannuation Contributions Tax (Assessment and Collection) Act 1997
subparagraph 8(2)(c)(iii).
subsection 8(3)
subsection 8(4)
subsection 13(2)
Other References:
Previously released as CDS10189
Keywords
Employer superannuation contributions
Superannuation provider - defined benefits
Surchargeable contributions
ISSN: 1445-2782
| Date: | Version: | |
| You are here | 22 June 1998 | Original statement |
| 15 December 2006 | Archived |