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14 Nov 14 On Div 293 tax assessments

MEMBER 179 writes:

"We received a Div 293 tax assessment which the taxpayer promptly paid from their personal funds. We try and encourage our clients to not request a release of funds from their superannuation fund to reduce administrative work and maximise their superannuation balance. 

Next we received an amended Div 293 tax assessment as the State government defined benefit fund has now reported employer contributions. Total contributions now exceeded the member’s concessional contributions cap, and for some reason the ATO decided that the originally reported and assessed accumulation superannuation fund contributions (a different fund) do not take precedence over the later reported defined benefit fund contributions. Consequently, a new deferred Div 293 tax liability is raised on the full amount of the defined benefit fund contributions and an amended and reduced Div 293 tax liability on the accumulated fund contributions. We understand that Div 293 tax does not apply to concessional contributions over the member’s contributions cap.

We then rang the ATO to transfer the overpayment of the original Div 293 tax assessment to the deferred tax liability. Unnecessary work on our part as the original assessment need not have been altered but rather the deferred tax liability should have been for the balance of the contributions up to the member’s cap.

Also we asked the ATO where was the payment slip to pay the deferred tax. We discover that was sent not with the assessments to our address as the agent but to the address that the client’s activity statements are mailed to (business address). Locating a payment slip is not obvious as it is attached to the Release authority and statement for Div 293 tax which does not contemplate a member paying from their own funds. 

We cannot even print a payment slip from the ATO Portal nor view the deferred Div 293 tax liability account. 

Next we eagerly await an excess contributions tax assessment notice and more options to pay. 

This whole area requires more thought and simplification to free agents and taxpayers to be more productive and avoid inefficient use of valuable time and resources.

There I feel better airing my grief but wonder whether anything will change."