The SMSF Association has called for complete system neutrality with regard to the implementation issues superannuation funds will inevitably face when the Division 296 tax is introduced on 1 July 2026.
SMSF Association chief executive Peter Burgess acknowledged the new measure will mean additional administration responsibilities for super funds likely to include adjustments for items such as assessable contributions and exempt current pension income.
“We do expect there will be a need for [administrative] system changes, particularly for the large funds but also for self-managed super funds as well. There may be changes made to the SAR (SMSF annual return) with new labels and so forth,” Burgess indicated during a recent webinar hosted by selfmanagedsuper.
“What we’re looking out for very carefully is to make sure we have system neutrality. We understand that the large funds do face some issues when it comes to adjusting cost bases but we don’t want the large funds getting preferential treatment,” he added.
“There has to be system neutrality and that’s what I’m mostly concerned about at the moment.”
Burgess reiterated the Treasurer has so far made it clear he is not considering any amendments to the revised policy he announced back in October despite having his attention draw to some of the difficulties with its implementation.
“The point I was trying to make to the Treasurer is this is the reason that we didn’t go down this track to start with because it’s a complicated process for the large funds in particular,” he said.
“The superannuation system is not designed for a tax like this. Superannuation funds are designed to calculate the taxable income at a fund level, and when you’re asking for the funds to do that down to a member level, it creates a lot of problems.
“Not really for self-managed super funds but mainly for the large funds that will have to make some reasonable changes to their systems to accommodate this tax.
“In our view there are simpler ways to go about it,” he concluded.
