Published on 29 Aug 2013
| Took place at Sheraton on the Park, Sydney
In the inaugural National Superannuation Conferernce, The Tax Institute brought together regulators and leading practitioners from the legal, accounting, audit and financial advisory services fields of the superannuation industry for two full days to discuss tax and other challenges and opportunities that exist within the ever-changing operating environment of superannuation.
Uniquely, this Conference was designed for tax professionals from both the large fund and self-managed superannuation fund (SMSF) sectors. A mixture of plenary sessions and two streams of breakout sessions (streams ‘A’ and ‘B’) were offered. Stream ‘A’ sessions were primarily for delegates from the large fund sector while stream ‘B’ sessions are for delegates from the SMSF sector.
Plenary sessions covered:
keynote address – benchmarking Australia’s superannuation system against the
best in the world
recent trends and developments for superannuation tax law
recent developments affecting contribution strategies and practices
pensions – exploring changes in the treatment of pensions.
Stream ‘A’ sessions covered:
capturing tax within unit prices or crediting rates
large fund issues and the ATO
tax considerations relevant to investments by superannuation funds
living to age 120, the pensions dilemma and other defined benefit conundrums
tax issues in successor fund transfers
what you need to know about superannuation guarantee
tax audits on large funds - what to look out for.
Stream 'B' sessions covered:
borrowing to acquire real property – is it worth all of the trouble?
small business CGT relief and related party transactions
SMSF issues and the ATO
practical Issues in administering and auditing SMSFs.
Get a 20% discount when you buy all the items from this event.
Keynote address: Benchmarking Australia's superannuation system against the best in the world
Author(s): David KNOX
In this paper, David Knox reviews Australia’s third placing in the Melbourne Mercer Global Pension Index and then compares our superannuation tax system to the leading countries in the index. He also highlights the shortcomings of the ongoing discussion around the superannuation tax concessions.
Recent developments affecting contribution strategies and practices
Author(s): David SHIRLOW
Contributions cap issues are becoming the bane of fund trustees and practitioners alike. This paper considers the increasing frequency of various problems being encountered in relation to the contributions caps and, in turn, the strategies and practices being adopted to deal with them. The following issuesare addressed:
the impact of changes to the tax treatment of contributions, including the significant amendments recently proposed by the government
dealing with excess contributions (until the proposed refunding provisions arelegislated), including applications for Commissioner discretion and related AAT findings and refund of concessional contributions
new rules for in specie contributions
other developments impacting on contribution strategies.
Living to age 120, the pensions dilemma and other defined benefit conundrums
Author(s): Barry RAFE
This presentation draws from the Institute of Actuaries’ White Paper titled the “Longevity tsunami” which addressed problems arising from the fact that people will be living a lot longer than they expect. The paper has contributed to a wide ranging community discussion on the implications of the so called “longevity problem” which has resulted in, among other things, Treasury adopting a more aggressive view on longevity, and changes in the tax status of various deferred annuity products.The presentation addresses various social and financial issues including:??
living to 120 will become the norm??
current issues for dealing with defined benefit pensions??
products that can protect against financial strains caused by longevity??
funding issues for a pension-only fund
??debate on who should carry the financial burdens of longevity.
It is the government’s policy to encourage the consolidation of large superannuation funds through mergers. However, this policy objective has not been assisted by the number of “road blocks” in the tax system that increase costs and make it more difficult for fund trustees to determine that mergers are in the best interests of their members. Although, there has recently been some relief via the ability to transfer losses and rollover capital assets, there are still many tax and duty issues that must be considered for a merger.
This presentation examines some of those issues, including:
in what circumstances, and for what structures, does the loss transfer and CGT asset rollover rules apply
tax consequences for the transfer of non-capital assets
issues arising out of the use of pooled superannuation trusts in mergers
what should be done if one fund values its assets on an after-tax basis and the other values it on a before-tax basis
issues arising out of deferred tax assets
no-TFN contribution issues
the “crystallisation” of members, benefits upon merger issue
the deductibility of merger costs for the transferee fund
The theory relating to benefit payments is well known as are some of the strategies on how to pay benefits in the most tax-effective manner. This paper explores the less common, possibly forgotten strategies that surround the laws on benefit payments by:
recapping on the taxation arrangements on lifetime and death benefits
discussing the implications of electing for a payment not to be treated as anincome stream
exploring the benefit of rolling back a pension now and commencing a new onelater
planning for income and salary sacrificing to maximise benefits
considering the opportunities with estate planning.
At first glance, superannuation guarantee (“SG”) appears to be an employer and employee issue rather than a superannuation fund issue. However, there are important SG issues for superannuation funds to consider. These include:
can a fund enforce superannuation contributions obligations under the SG law,awards or contract?
calculating SG obligations for defined benefit funds
the interaction between the MySuper changes and SG
the interaction between SG and excess contributions tax
the relationship between the fund and the contributing employer.
Borrowing by SMSFs to acquire real property - is it worth all the trouble?
Author(s): Chris BALALOVSKI, Simon Conolly
Many superannuation savers are borrowing to purchase real property in their SMSFs. Although this strategy delivers advantages for some investors, it should not be forgotten that the necessary regulatory requirements to effectively implement it are extremely complex and there are a myriad of issues and traps that need to be very carefully considered. The focus of this paper is on giving practitioners the necessary tools to properly advise clients who may be contemplating this strategy. It covers:
implementing, maintaining and dismantling the structure – what are the prudential, tax and stamp duty issues?
overview of the finalised SMSFR 2012/1 and TA 2012/7
what are the advantages and disadvantages of this strategy?
issues when auditing an SMSF that has implemented this strategy
Managing tax affairs:The duties of the super trustee
Author(s): John EDSTEIN
This paper addresses the duties of a superannuation trustee in relation to managing tax affairs of a superannuation fund under the general law, the SIS Act (especially the revised covenants for trustees and directors) and the APRA prudential standards. The paper covers the management of tax affairs in the context of:??
a superannuation trustee’s duty of care
??the best interests and conflicts covenants
??the investment covenant?? Investing in distributing trusts and the myriad of issues that can follow, whether the trusts are managed investment schemes or otherwise??
the non-arm’s length income provisions and recent case law??
managing errors that arise out of tax matters from a trust law perspective.
Indirect taxes, such as duty, GST and land tax, are often neglected when it comes to consideration of tax issues affecting superannuation funds.However, the indirect tax obligations, and potential exemptions and concessions that apply to superannuation funds are often vital parts of any review of potential tax considerations, particularly in relation to transfer of assets to and from a fund.
This paper covers:
a review of the application of duty for direct transfers of real estate to and from a superannuation fund in each state and territory
an update and review of the application of duty for indirect transfers of real estate ie interests in landholder/land-rich entities to and from a superannuation fund in each state and territory
an overview of other concessions available to superannuation funds such as change of trustees, set-up of funds etc
a brief update in relation to the application of the GST regime to transfers of real estate to and from a superannuation fund
the application of superannuation related land tax concessions in each state and territory.