A superannuation specialist has reminded advisers the eligibility as to whether unused portions of an individual’s concessional contributions cap can be carried forward into subsequent financial years is originally determined by self-assessment.
“As with a lot of things with super, including contribution caps, the eligibility is self-assessed in the initial stages. [It means] the onus is on us all as professionals, but ultimately the responsibility is on the client themselves from a tax perspective. As with [many things], you can delegate your authority [but] you can’t delegate your responsibility,” BT Financial Group technical consultant Matt Manning told attendees of a webinar held today for advisers and accountants.
Manning recognised this aspect of the retirement savings system incorporates some risk for superannuation fund members.
“If it turns out the client has tried to use the concessional [contributions] carry-forward [provisions] but, for example, doesn’t qualify because they had a total super balance at 30 June of the previous financial year of more than $500,000, then the ATO will only accept [a contribution of] $30,000 [under] the standard concessional cap and the rest of it will be [treated] as [exceeding the person’s concessional contributions cap],” he noted.
According to Manning, super fund members can refer to their MyGov account to confirm their eligibility for the concessional contributions cap carry-forward provisions, but warned about a known existing flaw with the portal.
“Often if somebody hasn’t made contributions in previous financial years, it won’t [be reflected] in the relevant section of the ATO portal of MyGov,” he revealed.
“We can [determine] that by looking at the superannuation menu [tab on the service] and then the carry-forward concessional contributions [option].
“If you see it [is not reflecting] any amounts from the previous financial years, that’s a cue to get on the front foot and contact the ATO.”
The reason for this action is to alert the regulator to the fact the fund member wants to take advantage of the concessional contributions cap carry-forward rules and to have any previous use of this provision show up in the MyGov portal.
Manning also took the opportunity to note there is no obligation to submit a notification to the ATO of the member’s intention to use the concessional contributions cap carry-forward provisions.
