AMP responds to super contribution tax changes
AMP SMSF has welcomed the new tax rules around excess non-concessional contributions but says a number of outstanding issues are yet to be addressed.
While the new provisions will provide those who have inadvertently breached their non-concessional cap with additional options, AMP SMSF’s head of policy, technical and educational services Peter Burgess told SMSF Adviser there are still issues relating to the way commissioner discretion works.
“Even though we [now] have the refunding rules in place, it’s still in most cases a better outcome for clients to seek discretion and [have] that excess re-allocated or disregarded,” said Mr Burgess.
“They will avoid paying a concessional contribution charge if it’s an excess concessional contribution or having to pay tax on the associated earnings component if it’s a non-concessional.”
Although successfully receiving commissioner discretion will generally result in a better outcome for clients than using the new refund rules, Mr Burgess said this remains difficult to obtain.
“There’s a very narrow interpretation and definition of special circumstance and I think that’s one area that still needs attention,” he said.
Mr Burgess said the new rules will, however, see some improvement in the fairness of the system.