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Edited version of private ruling

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Ruling

Subject: Variation of notice under section 290-170

Question:

Can a notice made under section 290-170 of the Income Tax Assessment Act  1997 be varied to nil when the superannuation provider has commenced to pay an income stream based in whole or part on the personal contributions?

Advice/Answers:

No

This ruling applies for the following period:

1 July 2008 to 30 June 2009

The scheme commenced on:

1 July 2008

Relevant facts:

In the 2008-09 income year you made a personal superannuation contribution to your superannuation fund (the Fund). The contribution was intended to be a non-concessional contribution.

A staff member of your financial adviser completed documentation for a superannuation income stream to be paid from your accumulation account with the Fund.

When completing the relevant documentation the section of the paperwork headed 'Tax deduction notice' was completed by the staff member indicating a tax deduction was to be claimed in respect of the above contribution.

This section was subsequently signed by you.

The Fund treated the contribution as a concessional contribution and 15% tax was deducted from the contribution.

It is unclear if the Fund provided you with an acknowledgement of the notice of your intent to claim a deduction.

Your financial adviser requested the Fund to amend their records to treat the contribution as a non concessional contribution. The Fund declined to do so on the basis that a superannuation income stream had commenced to be paid to you.

Relevant legislative provisions:

Income Tax Assessment Act 1997 section 290-170

Income Tax Assessment Act 1997 subsection 290-180(1)

Income Tax Assessment Act 1997 subsection 290-180(2)

Income Tax Assessment Act 1997 subsection 290-180(3)

Income Tax Assessment Act 1997 subsection 290-180(3A)

Income Tax Assessment Act 1997 subsection 290-180(4)

Reasons for decision

Summary

You cannot vary the 'Notice of intent to deduct' made under section 290-170 to nil as the superannuation income stream, which is based on the contribution made, has commenced.

Detailed reasoning

Section 290-180 of the Income Tax Assessment Act 1997 (ITAA 1997), which applies from 1 July 2007, allows you to vary the notice of intent to deduct made under section 290-170 (section 290-170 notice).

Section 290-180 of the ITAA 1997 provides that a section 290-170 notice may be varied but not revoked or withdrawn.

Subsection 290-180(3A) of the ITAA 1997 provides that the variation is not effective if, when you make it:

In this case you had started to receive an income stream from your superannuation fund (the Fund), based on the contribution made by you. The Fund states that this is the reason why they are unable to amend past contribution notices.

The Explanatory Memorandum to the Superannuation Legislation Amendment (Simplification) Bill 2007, which inserted sections 290-170 and 290-180, described this requirement as follows:

It is noted in the documentation forwarded by you that the section headed 'Tax deduction notice' requires the fund member's signature. This section was signed by you, thereby indicating an intention to claim a deduction. It is your responsibility to check the correctness of a document before signing it.

Accordingly, the notice is a valid notice under subsection 290-170(2) of the ITAA 1997.

While you have provided reasons why the form was filled in incorrectly, the Commissioner has no discretion to waive the conditions required under subsection 290-180(3A) of the ITAA 1997.

Therefore the notice can not be varied to nil.

While you may feel that the ruling is neither fair nor equitable, the Commissioner is required to apply the law as enacted by the Australian Parliament, to the circumstances of your case.

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