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  • Example 5 – Rollover of account-based pension from an SMSF to an APRA fund

    Example 5 assumes there are no investment earnings, losses or administration fees. In some cases, rounding has been applied to eliminate cents and simplify the calculations.

    Saxon has an account-based pension valued at $950,000 as at 30 June 2018 with the Saxon SMSF.

    As Saxon had a pre-existing income stream, this should've been reported on a TBAR on or before 1 July 2018. Saxon only takes pension payments in the 2017–18 financial year.

    In August 2018, Saxon decides to rollover his pension to APRA Fund BBB and wind up the Saxon SMSF.

    APRA Fund BBB commences Saxon’s new pension in August 2018. When the rollover is made, Saxon's SMSF provides Fund BBB with an RBS reporting income tax and contributions information as follows.

    Completing the RBS when the rollover is made

    Saxon's SMSF completes item 13 'Tax components' (which are the income tax components) as follows:

    Item 13 – Rollover components

    Tax-free component

    $800,000

    Taxable component:

    Element taxed in the fund

    $150,000

    Element untaxed in the fund

     

    Completing the SMSF annual return after the end of the financial year

    Saxon will need to include at section G label Q 'Outward rollovers and transfers' the amount he rolled over of $950,000 when completing the SMSF annual return (SAR) for the 2018-19 financial year.

    Section G will include the following amounts:

    Opening account balance

    $950,000

    Label A – Employer contributions

    Nil

    Label B – Personal contributions

    Nil

    Label N–- Total contributions

    Nil

    Label O – Allocated earnings or losses

    Nil

    Label P – Inward rollover amounts

    Nil

    Label Q – Outward rollovers and transfers

    $950,000

    Label R – Benefit payments and code

    Nil

    Label S – Closing account balance

    Nil

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      Last modified: 31 Jan 2019QC 25212