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Ruling

Subject: Spouse superannuation contribution tax offset

Question

Are you entitled to claim a spouse superannuation contribution tax offset in the 2011-12 financial year?

Answer

No

This ruling applies for the following periods:

Year ending 30 June 2012

The scheme commences on:

1 July 2011

Relevant facts and circumstances

You made a contribution to your spouse's superannuation during the 2011-12 financial year. Your spouse has assessable income greater than $13,800 and a taxable income of less than zero.

Relevant legislative provisions

Income Tax Assessment Act 1997 Section 6-5,

Income Tax Assessment Act 1997 Section 6-10,

Income Tax Assessment Act 1997 Section 290-230 and

Income Tax Assessment Act 1997 Section 290-235.

Reasons for decision

Superannuation Contributions for Spouse Rebate

Section 290-230 of the Income Tax Assessment Act 1997 (ITAA 1997) allows a tax offset for a taxpayer who makes superannuation contributions on behalf of their spouse. In order to claim the tax offset, the following conditions must be met:

· you have a spouse at the time of making the superannuation contribution;

· both you and your spouse are Australian residents when you made the contribution;

· the total of your spouse's assessable income, reportable fringe benefits and reportable employer superannuation contributions is less than $13,800;

· you cannot claim a deduction for the contribution under section 290-60 of the ITAA 1997; and

· the fund which receives the contribution is a complying superannuation fund.

Section 290-235 of the ITAA 1997 states that the offset amount is limited to 18% of the lesser of:

· $3,000 reduced by $1 for every $1 of the amount (if any) by which to total mentioned in paragraph 290-230(2)(c) that years exceeds $10,800; or

· the total of the eligible spouse contributions made in relation to the spouse by the taxpayer that year.

Section 6-5 of the ITAA 1997 defines the term "assessable income" as follows:

your assessable income includes income according to ordinary concepts, which is called ordinary income. If you are an Australian resident, your assessable income includes the ordinary income you derived directly or indirectly from all sources, whether in or out of Australia, during the income year.

In working out whether you have derived an amount of ordinary income, and if so, when you derived it, you are taken to have received the amount as soon as it is applied or dealt with in any way on your behalf or as you direct. 

Section 6-10 of the ITAA 1997 extends the definition of assessable income as follows:

your assessable income includes some amounts that are not ordinary income. Amounts that are not ordinary income, but are included in your assessable income by provisions about assessable income, are called statutory income. If you are an Australian resident, your assessable income includes the statutory income you derived directly or indirectly from all sources, whether in or out of Australia, during the income year.

If an amount would be statutory income apart from the fact that you have not received it, it becomes statutory income as soon as it is applied or dealt with in any way on your behalf or as you direct.

In your case, your spouse's assessable income is greater than the threshold of $13,800. You are not entitled to a spouse superannuation contribution tax offset. Although your spouse's taxable income is less than zero, for the purposes of this tax offset only assessable income is taken into account, not the taxable income which results after the subtraction of any allowable deductions.