Your shopping cart is empty

In a press release issued on 3 November 2005, the Minister for Revenue and Assistant Treasurer, Peter Dutton, announced that the Government will act to allow superannuation funds to continue to invest in instalment warrants, consistent with longstanding administrative practice.  

The Minister said that over a number of years instalment warrants have been marketed to superannuation funds - particularly to self managed superannuation funds (SMSFs). The Commissioner of Taxation (responsible for regulating SMSFs) and the Australian Prudential Regulation Authority (responsible for regulating other superannuation funds) have now concluded that these products entail a borrowing for the purposes of section 67 of the Superannuation Industry (Supervision) Act 1993 (SIS Act) and are therefore not an allowable investment.

The borrowing prohibition has been in place since the 1980s, and is one of a number of rules in superannuation legislation designed to limit risk in superannuation fund investments.

“While the Regulators have concluded that investment in instalment warrants by superannuation funds is not in keeping with the SIS Act, the practice is long standing and widespread and superannuation fund investment comprises a significant proportion of the instalment warrant market.  The Government will legislate to allow longstanding practice to continue, following consultation with industry regarding the precise scope of amendments to the SIS Act,” Mr Dutton said.  

In order to avoid any disruption to markets, the Regulators have advised that, pending the law change, superannuation funds investing in traditional instalment warrants will not be considered to be non-complying under the SIS Act merely because of their investment in those products.

For a copy of the Minister's press release, No 2006/078, 3 November 2006, go here

TAXVINE COMMENT: The Minister's announcement follows the discussion in TAXVINE's Member Feedback on this very subject - see 2006 TAXVINE Nos 38 (17) and 40 (18) published on 6 October and 20 October 2006 respectively. Does the Minister read TAXVINE?

Media Release Search
Eg. TD 2005/D52 ALL words EXACT phrase WITHOUT words Date range
From To