The number of Excess Contributions Tax notices issued in the 2009-10 financial year has spiked by almost 296%, according the latest statistical update from the ATO. The sharp increase from 15, 315 assessments issued in 2008-09 to 45,330 in 2009-10 is being attributed to the Government’s decision in 2009 to halve the concessional contributions cap. “A lot of people got caught in an excess tax position because of the timing issue,” said Aaron Dunn, managing director of the SMSF Academy.
“There should have been some remedy to fix that many people impacted by a policy decision but the Government is clearly trying to address this moving forward. Though I think it may be a better avenue for the Government to refund on an annualised basis rather than a simple once off,” said Dunn. This is consistent with the position of the Self-Managed Super Fund Professionals’ Association of Australia (SPAA), which has urged the $10,000 inadvertent breach refund be made available on an ongoing basis.
2 April 2012 | Melanie Timbrell, Financial Standard – Go To ARTICLE
Concessional contribution cap breaches have increased around three-fold in the past three years, according to specialist SMSF company, Canvendish Superannuation. Cavendish head of education, David Busoli this week pointed to the latest Australian Taxation Office (ATO) data on excess contributions tax and the strong trends which had emerged. He said the number of concessional cap breaches had increased three-fold from 15,315 in 2008/09 to 45,330 in 09/10.
Institute of Chartered Accountants in Australia superannuation specialist, Liz Westover has pointed to the latest Australian Taxation Office statistics on excess contributions tax (ECT) as having confirmed just how problematic the regime remains. In analysis published this week, Westover suggested the Government and the regulators had got it wrong in believing that excess contribution tax contributions would decline as people become more aware of the consequences. “When concessional contributions were introduced and ECT assessments started being issued, the government and regulators believed that the number of assessments would fall as people became aware of the new rules,” she said.
2 April 2012 | Mike Taylor, Money Management Go To ARTICLE