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Edited version of your written advice
Authorisation Number: 1013137332612
Date of advice: 8 December 2016
Ruling
Subject: Deductibility of personal superannuation contributions
Question
Can a person (the Taxpayer) claim a deduction for a contribution made to a superannuation fund in the 20XX-YY income year pursuant to section 290-150 of the Income Tax Assessment Act 1997 (ITAA 1997), where a notice of intent to deduction contributions was not given to the trustee of the fund before the contribution was rolled over into another fund?
Answer
No.
This ruling applies for the following periods:
Income year ended 30 June 20YY.
The scheme commences on:
1 July 20XX.
Relevant facts and circumstances
The Taxpayer is a member of a superannuation fund (the Fund).
During the 20XX-YY income year, the Taxpayer made a contribution (the Contribution) into the Fund.
In 20YY, before the Taxpayer gave the trustees of the Fund a notice of intent to deduct the Contribution, the Contribution was rolled over into the self-managed superannuation fund (the SMSF).
The Fund is a complying superannuation fund.
The Taxpayer satisfies the maximum earnings as an employee condition in section 290-160 of the ITAA 1997.
The Taxpayer satisfies the age related conditions in section 290-165 of the ITAA 1997.
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.
Reasons for decision
Summary
A notice of intent to claim a deduction for the Contribution given to the trustees of the Fund after the Contribution was rolled over into the SMSF would not be valid because at that time, the trustees no longer held the Contribution.
The Commissioner has no discretion to allow a deduction for a superannuation contribution where the conditions in section 290-170 of the ITAA 1997 have not been met.
Therefore, the Taxpayer cannot claim a deduction for the Contribution made to the Fund in the 20XX-YY income year.
Detailed Reasoning
Section 290-150 of the ITAA 1997 provides that an individual may deduct a contribution made to a superannuation fund for the purpose of providing superannuation benefits for themselves, or their dependants after their death.
However, subsection 290-150(2) of the ITAA 1997 states that all conditions in sections 290-155, 290-160 (if applicable), 290-165 and 290-170 must also be satisfied for an individual to deduct a contribution made in that income year.
Notice of intent to deduct conditions
Relevantly, subsection 290-170(1) of the ITAA 1997 requires that a valid notice of intention to claim the deduction must be given to the superannuation fund trustee. The notice must be given by the earlier of:
● the date the taxpayer lodges their income tax return; or
● the end of the income year following the year in which the contribution was made.
Under subparagraph 290-170(2)(c)(ii) of the ITAA 1997, a notice will not be valid if, at the time the notice is given to the trustee, the trustee no longer holds the contribution.
As a notice of intent to deduct the Contribution was not given to the trustees of the Fund before the Contribution was rolled over into the SMSF, any notice given after the roll-over is not valid because the trustees of the Fund no longer hold the contribution.
The Commissioner may exercise his discretion to extend a specified time limit only where the power to do so has been specifically provided for in the legislation. There is no section of the ITAA 1997 or of the Taxation Administration Act 1953 which allows the Commissioner to exercise his discretion to allow a deduction for a superannuation contribution where the conditions in sections 290-170 of the ITAA 1997 have not been met, regardless of the circumstances.
Accordingly, the Taxpayer is unable to claim a deduction for the Contribution they made to the Fund in the 20XX-YY income year.