ATO Interpretative Decision
ATO ID 2003/612 (Withdrawn)
Income Tax
CGT: Marriage breakdown roll-over - transfer of a member's superannuation interest to another superannuation fundFOI status: may be released
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This ATOID is withdrawn because the ATO view on this matter is now included in the Guide to capital gains tax 2005-06 (page 89).This document incorporates revisions made since original publication. View its history and amending notices, if applicable.
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you will need to ensure that the relevant provisions referred to in the decision have not been amended or repealed.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 roll-over relief available under subsection 126-140(2) of the Income Tax Assessment Act 1997 (ITAA 1997) where a member of a superannuation fund transfers their original interest to another superannuation fund?
Decision
No. Roll-over relief is not available to the trustee of the original superannuation fund under subsection 126-140(2) of the ITAA 1997, where a member of a superannuation fund transfers their original interest to another superannuation fund.
Facts
A taxpayer and their former spouse both had interests in a self-managed superannuation fund.
On the breakdown of their marriage, a portion of the former spouse's interest in the superannuation fund was transferred to the taxpayer. The taxpayer, as a consequence had two interests in the superannuation fund; the taxpayer's original interest and the interest transferred from the former spouse.
The taxpayer transferred all their interests in a self-managed superannuation fund (the original superannuation fund) to another self-managed superannuation fund.
Reasons for Decision
Subsection 126-140(2) of the ITAA 1997 allows a capital gains (CGT) tax roll-over to a superannuation fund where
- (a)
- an interest in a complying superannuation fund with four or less members is subject to a payment split; and
- (b)
- as a result of the payment split, there is a transfer or roll-over of benefits, for the benefit of the non-member spouse, from the complying superannuation fund to another complying superannuation fund; and
- (c)
- the transfer of benefits is under provisions of the Superannuation Industry (Supervision) Regulations 1994 dealing with superannuation interests that are subject to payment splits; and
- (d)
- the trustee of the first fund subsequently transfers a CGT asset to another small superannuation fund for the benefit of the non-member spouse.
The member's original superannuation interest is not subject to a payment split, as defined in section 90MD of the Family Law Act 1975. Subdivision 126-D of the ITAA 1997 does not therefore provide CGT relief on the transfer of a CGT asset in satisfaction of a member's original superannuation interest between funds upon marriage breakdown.
As a consequence, the capital gain or loss made by the trustee of the original superannuation fund from the transfer of a CGT asset, in satisfaction of the taxpayer's original superannuation interest, to the trustee of another superannuation fund is not disregarded.
Date of decision: 20 June 2003Year of income: Year ended 30 June 2003
Legislative References:
Income Tax Assessment Act 1997
Subdivision 126-D
subsection 126-140(2)
section 90MD
Keywords
Capital gains tax
CGT marriage breakdown
CGT same asset roll-over
Self managed superannuation funds
ISSN: 1445-2782
| Date: | Version: | |
| 20 June 2003 | Original statement | |
| You are here | 3 November 2006 | Archived |