ATO reveals ECT impacts
The Australian Taxation Office (ATO) has confirmed the degree to which superannuation fund members have been exposed to the harsh realities of the Government's excess contributions tax (ECT) regime, claiming 70 per cent of those affected last financial year would have been entitled to a refund under the later changes.
The reality of how the ECT regime has impacted the sector was made clear by ATO deputy commissioner for superannuation Neil Olesen earlier this month, when he pointed out to an accountants' forum that for the 2011-12 year, people who exceed their concessional cap by under $10,000 will be offered the option to have the excess removed from their fund and taxed at their marginal rate for that year.
"If this measure had been in place in 2010-11, over 70 per cent of people would have qualified for the refund offer," he said.
However Olesen said the overwhelming majority of people had managed to stay within their caps, and that of the 11.37 million people who had contributed to super in 2010-11, 11.32 million had managed to stay within the caps and would not receive an assessment.
"This is 99.5 per cent of contributors," he said.
Olesen said where the caps were exceeded, the overwhelming majority of people exceeded the concessional caps only.
"For the 2009-10 year, for example, where our processing of assessments is now almost complete, we've issued some 52,000 assessments, over 50,000 for contributions exceeding the concessional cap, 1300 for contributions exceeding the non-concessional cap, and fewer than 400 where both caps have been exceeded," he said.
"About four per cent (or 2000) of those people have gone on to ask the Commissioner to exercise his discretion to reallocate or disregard excess contributions. The Commissioner has said 'yes' in about 25 per cent (or 500) of those cases," Olesen said.
Recommended for you
Data and technology provider Novigi has acquired Iress’ superannuation consulting and managed services business from Apex Group.
AMP is to launch a digital advice service to provide retirement advice to members of its AMP Super Fund, in partnership with Bravura Solutions.
Unveiling its performance for the calendar year 2024, AMP has noted a “careful” investment in bitcoin futures proved beneficial for its superannuation members.
SuperRatings has shared the median estimated return for balanced superannuation funds for the calendar year 2024, finding the year achieved “strong and consistent positive” returns.
