06 Nov 099 On excess contributions tax in respect of the $1M non-concessional cap"I refer to the excess contributions tax furore. I have a number of clients who by simple mistake put too much into their superannuation fund, and their accountant or adviser somehow missed it. This is typically because the contribution was made in late 2006 (but caught in the $1M cap applicable 10 May 2006 to 30 June 2007) and as it was the previous financial year was possibly forgotten or not carefully checked.
Now the ATO are chasing a significant tax penalty when the opportunity to withdraw the excess has passed, and the ATO are being very harsh on applications to extend the time in which to apply. The press mentioned 24,000 taxpayers are caught up in it.
It seems to me an inappropriate penalty, which will result probably in many advisers and insurance companies bearing the brunt of the cost, or the taxpayer themselves if they can't find an adviser who was somehow involved."