Superannuation 2015

Excess superannuation contributions: Your worst nightmare or your best friend?

Source: The Tax Specialist Journal Article

Published Date: 1 Aug 2015


Although the rules which govern taxation of contributions to the superannuation system remain extremely complex and subject to constant reform, the consequences for exceeding annual contribution limits have been moderated considerably in recent years. This article will critically examine changes to the taxation of contributions since 1 July 2012, namely, the impact of the excess contributions tax regime in respect of excess concessional contributions and excess non-concessional contributions, the imposition of the Div 293 surcharge, and the availability of the Commissioner's discretion to disregard or reallocate excess contributions to another income year.

The article will consider the reasons for change, the effect on taxpayers, and issues in respect of implementation of the changes. The author concludes with the opinion that, while reform of the excess contributions tax has improved the equity and integrity of the superannuation system, taxpayers remain exposed to the burden of legislative risk impacting certainty and confidence while working and saving for retirement.

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Superannuation 2015

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