Recent Australian Taxation Office figures revealing another increase in excess contributions tax (ECT) breaches foreshadows a potential perfect storm when the concessional contribution cap for those aged 50 and over, with a superannuation balance over $500,000, is halved again from 1 July this year. The warning, from the Self-Managed Super Fund Professionals’ Association (SPAA), follows the ATO’s ECT Statistical Report showing that ECT breaches had tripled in one year, with 45,330 excess concessional contributions assessments issued during the 2010 financial year, up from 15,315 recorded in 2008/09 and 18,068 in 2007/08.
5 April 2012 | Chris Kennedy, Money Management DOWNLOAD ARTICLE
Tony Negline has a tip for us –
“Would you like to double your concessional super contributions this financial year and also avoid excess contributions tax? This is how you do it and how to avoid getting into trouble.
Some important details about this strategy are found in a tax office Interpretative Decision (2012/16), published in early March. I encourage you to read this document. It’s my guess that because of the way many large super funds are set up and their need to standardise administration and operations, they’ll find it too hard to execute this strategy. This means if you want to use it you’ll need a self-managed super fund.”
Reported 10 April 2012 | Tony Negline, The Australian, page 22