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Edited version of your written advice
Authorisation Number: 1012987565231
Date of advice: 21 March 2016
Ruling
Subject: Deductibility of personal superannuation contributions.
Question
Can you claim a deduction under section 290-150 of the Income Tax Assessment Act 1997 (ITAA 1997) for payments made into an overseas retirement annuity fund?
Answer
No
This ruling applies for the following periods:
Year ending 30 June 2016
The scheme commences on:
1 July 2015
Relevant facts and circumstances
You immigrated to Australia from an overseas country in 200X and are an Australian citizen.
While living overseas, you became a member of a retirement annuity fund (the Annuity Fund).
The Annuity Fund was established overseas and its central management and control is overseas.
You continue to make regular monthly payments into the Annuity Fund.
Relevant legislative provisions
Income Tax Assessment Act 1997 Section 290-150
Income Tax Assessment Act 1997 Section 290-155
Income Tax Assessment Act 1997 Section 290-160
Income Tax Assessment Act 1997 Section 290-165
Income Tax Assessment Act 1997 Section 290-170
Income Tax Assessment Act 1997 Subsection 295-95(2)
Income Tax Assessment Act 1997 Subsection 995-1(1)
Superannuation Industry (Supervision) Act 1993 Subsection 10(1)
Superannuation Industry (Supervision) Act 1993 Section 42
Superannuation Industry (Supervision) Act 1993 Subsection 45(1)
Reasons for decision
Summary
You cannot deduct payments made into the Annuity Fund because it is not a complying superannuation fund for the purposes of section 290-150 of the ITAA 1997.
Detailed reasoning
Personal deductible superannuation contributions
A person can claim a deduction for personal contributions made to a superannuation fund for the purpose of providing superannuation benefits for themselves under section 290-150 of the ITAA 1997.
However, subsection 290-150(2) of the ITAA 1997 provides that the conditions in sections 290-155, 290-160 (if applicable), 290-165 and 290-170 of the ITAA 1997 must also be satisfied for the person to claim the deduction.
Complying superannuation fund condition
Section 290-155 of the ITAA 1997 requires that where the contribution is made to a 'superannuation fund', it must be made to a 'complying superannuation fund' for the income year of the fund in which you made the contribution.
In accordance with subsection 995-1(1) of the ITAA 1997, 'complying superannuation fund' means a complying superannuation fund within the meaning of section 45 of the Superannuation Industry (Supervision) Act 1993 (SISA).
Relevantly, subsection 45(1) of the SISA provides that for the purposes of ITAA 1997, a fund is a complying superannuation fund if, and only if:
(a) the Regulator has given a notice to a trustee of the fund under section 40 stating that the fund is a complying superannuation fund in relation to the current year of income; or …
In accordance with subsection 10(1) of the SISA, 'Regulator', for the purposes of section 40 of the SISA means:
(a) the Commissioner of Taxation with respect to SISA provisions administered by the Commissioner of Taxation; and
(b) APRA with respect to SISA provisions administered by APRA.
According to subsection 42(1) of the SISA, a superannuation fund will receive a complying fund notice from APRA or the Commissioner of Taxation if:
(a) the fund is a resident regulated superannuation fund at all times during the year of income when the entity was in existence; and
(b) the fund has met the prescribed conditions to be a complying superannuation fund for the purposes of the SISA.
Subsection 10(1) of the SISA defines a 'resident regulated superannuation fund' to mean a regulated superannuation fund that is an 'Australian superannuation fund' within the meaning of the ITAA 1997.
As far as relevant, subsection 295-95(2) of the ITAA 1997 states:
A *superannuation fund is an Australian superannuation fund at a time, and for the income year in which that time occurs, if:
(a) the fund was established in Australia, or any asset of the fund is situation in Australia at that time; and
(b) at that time, central management and control of the fund is ordinarily in Australia…
*To find definitions of asterisked terms, see the Dictionary, starting at section 995-1.
As the Annuity Fund was established overseas, and its central management and control is overseas, it is not an Australian superannuation fund. As such, it does not satisfy the complying superannuation fund condition outlined in section 290-155 of the ITAA 1997.
As personal contributions are only deductible if all the conditions for deductibility are met, it is not necessary to consider if the other conditions prescribed in subsection 290-150(2) of the ITAA 1997 have been met.
Therefore, payments made into the Annuity Fund are not deductible under section 290-150 of the ITAA 1997.
ATO view documents
Taxation Ruling TR 2010/1 Income tax: superannuation contributions