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ATO Interpretative Decision

ATO ID 2003/194

Income Tax

Deduction for loss on withdrawal from a superannuation fund
FOI status: may be released

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  • This document incorporates revisions made since original publication. View its history and amending notices, if applicable.

CAUTION: This is an edited and summarised record of a Tax Office decision. This record is not published as a form of advice. It is being made available for your inspection to meet FOI requirements, because it may be used by an officer in making another decision.

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you will need to ensure that the relevant provisions referred to in the decision have not been amended or repealed.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 taxpayer entitled to claim a deduction under subsection 8-1(1) of the Income Tax Assessment Act 1997 (ITAA 1997) if the amount paid on withdrawal from a superannuation fund is less than the amount they invested?

Decision

No. The taxpayer is not entitled to claim a deduction under subsection 8-1(1) of ITAA 1997 if the amount paid on withdrawal from a superannuation fund is less than the amount they invested.

Facts

The taxpayer purchased an allocated pension from a superannuation fund.

The taxpayer withdraws from the fund. The amount paid out is less than the amount the taxpayer invested.

Reasons for Decision

Subsection 8-1(2) of the ITAA 1997 denies the taxpayer a deduction for this loss because it is capital in nature.

This means that only the eligible termination payment provisions apply.

Date of decision:  1 November 2001

Year of income:  Year ended 30 June 2002

Legislative References:
Income Tax Assessment Act 1997
   section 8-1

Related Public Rulings (including Determinations)
Taxation Ruling IT 2157

Related ATO Interpretative Decisions
ATO ID 2003/193

Keywords
Eligible termination payments
Superannuation, retirement & employment termination
Allocated annuities & pensions
Superannuation pensions
Superannuation
Complying superannuation funds
Deductions & expenses

Business Line:  Small Business/Individual Taxpayers

Date of publication:  4 April 2003

ISSN: 1445-2782

history
  Date: Version:
You are here 1 November 2001 Original statement
  23 June 2017 Archived

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