Compliance, Superannuation

No simplification for personal super contributions

Industry expectations that Treasury would simplify the process by which individuals claim a tax deduction for personal superannuation contributions have not come to fruition.

SuperConcepts technical services and education general manager Peter Burgess told attendees at the SMSF Professionals Day 2018, co-hosted by selfmanagedsuper and SuperConcepts: “We were all hoping that Treasury was actually going to simplify the [personal superannuation deduction] rules, but what they’ve done instead is to make sure the rules work as they were originally intended.

“It means they’ll be spending more money on educating the community on how to actually claim deductions by putting in notices of intent.”

Burgess admitted he was hoping for the rules to be simplified because the super reforms contained in the 2016 federal budget had made a larger number of individuals eligible for deductible personal super contributions.

“These rules are quite complex and a lot of people get it wrong. They don’t notify their fund they intend to claim a deduction, they don’t get the acknowledgement form from their super fund. There are a lot of places where they can make mistakes and they have made lots of mistakes,” he noted.

The ATO to date has introduced a new section to the tax return forms for individuals allowing them the ability to declare they intend to claim a deduction for personal super contributions.

Section D12 on the form now asks individuals to confirm or deny if they intend to claim such a deduction and if they have followed the required process to do so.

Specifically, the section asks individuals to answer yes or no to the question: “Did you provide your fund (including a retirement savings account) with a notice of intent to claim a deduction for personal superannuation contributions, and receive an acknowledgement from your fund?”

If answered in the affirmative, individuals then have to supply the name of the fund, their account number, the fund Australian business number, the fund tax file number and the amount of contributions for which they are looking to receive a tax deduction.

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