10 Oct 066 Minister clarifies Simplified Super contribution capsIn a press release issued on 9 October 2006, the Minister for Revenue and the Assistant Treasurer, Peter Dutton, denied a suggestion in the Australian Financial Review that there was uncertainty over the immediate operation of the new Simplified Superannuation contributions caps.
The Minister said: "There is a $1 million transitional cap for post-tax contributions made between 10 May 2006 and 30 June 2007. This transitional cap is available to all individuals who are eligible to contribute to superannuation.
In addition, proceeds from the disposal of eligible small business assets which are contributed to superannuation will not count towards the cap on post-tax contributions, up to a lifetime limit of $1 million. This small business exemption applies from 10 May 2006.
Contributions in excess of these amounts may be subject to penalty. To limit genuine inadvertent breaches of the cap, the Government announced that the ATO will have the discretion to reduce the amount of excess contributions subject to the tax. In addition, individuals who can satisfy the ATO that they exceeded the transitional limit inadvertently will be able to withdraw the excess amount without penalty prior to 1 July 2007.
The legislation to implement these discretions will be introduced into Parliament before the end of the year."
For a copy of the Minister's press release, No 2006/73, 9 October 2006, go here