The Self-managed Independent Superannuation Funds Association (SISFA) has called on the federal government to refund excess pension payments for the 2020 financial year that are above new, temporary thresholds, and remove proportionate indexation of the transfer balance cap (TBC).
In a recent submission to Treasury, SISFA recommended the government allow super fund members to refund any 2019/20 excess pension amounts paid prior to the March reduction to the minimum annual pension payment requirement, which was implemented by the government in response to the COVID-19 pandemic.
“Individuals who had already been paid pension amounts in the 2019/20 year which exceeded the reduced requirement are unfairly treated as under current rules they are unable to adjust (return) the excess pension amount paid,” SISFA said.
“SISFA recommends that government provide for the ability for superannuation fund members to refund to their superannuation fund any excess amount, with such refund being able to be made up until 30 June 2021. This refund would only be available in respect of excess pension payments made during 2019/20.”
Highlighting the expected indexation of the TBC, it also called for the removal of proportionate indexation of the TBC.
“SISFA intends to make a more substantial submission in relation to this issue, but in the meantime submits that the proportionate indexation regime should be replaced with a flat indexation regime, that is, so that every person receives a $100,000 increase in their transfer balance cap when indexation is triggered,” it said.
In addition, referring to a recent submission from joint industry bodies calling for an extension to the superannuation guarantee amnesty date, it requested the end date be extended to 7 March 2021.