SMSF Adviser understands the ATO is currently preparing guidance on the limited circumstances when an individual will be allowed to access some of their superannuation early before making salary-sacrificed super contributions to lower their taxable income.
Individuals would have had to prove they met at least one of the eligibility requirements, including seeing a reduction in working hours by 20 per cent or more, or seeing a reduction in turnover of 20 per cent or more as a sole trader.
It is understood that the ATO will indicate that the number of circumstances where they are comfortable with someone dipping into their super and later claiming a concessional tax-deductible contribution will be very limited.
Temporary early access to super was one of several changes made to superannuation as a part of the government’s second stimulus package to offset the economic effects of the coronavirus outbreak.
APRA data published on Monday showed early super payments up to 7 June had totalled at $14.8 billion, with 1.98 million applications out of 2.12 million having been paid out.
According to the ATO, it has now approved 1.9 million applications for early release of super, totalling $16 billion from superannuation funds.
Eligible individuals could apply for an early release of up to $10,000 in the 2019–20 financial year through the myGov website since 20 April.
A second payment of up to $10,000 will be available from 1 July 2020, and members will have until 24 September to apply.
Loophole ? – just poorly drafted legislation.
Will the same apply where someone withdraws up to $10k first and later re-contributes up to $10k either between now 30 June and / or between 1 July and 24 Sept. The business did have a 95% income reduction.