Give ATO discretion on bad financial advice, says AIST
The Australian Taxation Office should be able to exercise discretion when concessional caps are breached due to poor financial advice, says Australian Institute of Superannuation Trustees (AIST) chief executive Fiona Reynolds.
Representatives from the AIST will appear today at a public hearing into the Tax and Superannuation Laws Amendment (2012 measures no. 1) Bill 2012 in Canberra.
According to Reynolds, the AIST will be arguing against the pausing of the indexation of the concessional contributions cap, as well as more flexibility when concessional caps are breached due to "a genuine error".
If an individual hasn't understood the rules properly, or an employer has made contributions in the wrong period (ie, after 30 June), the tax office should have discretion. The same thing should be true in the case of bad financial advice, she added.
"What if your financial adviser or your accountant did something wrong with your payments, or something like that? Maybe you got some bad advice about when to put the contributions in. As unlikely as these things are to happen, they do happen," Reynolds said.
At today's public hearing, the AIST will also be arguing for the 'bring forward' rule to be applied to concessional contributions, similar to non-concessional contributions, she said.
The industry body will also argue that individuals who breach their contributions limit by up to $10,000 should be eligible for the same relief in later years, on a "case-by-case basis", said Reynolds.
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