Powered by MOMENTUM MEDIA
subscribe to our newsletter
More good news for contribution reserves

More good news for contribution reserves

Katarina Taurian
25 August 2015 — 1 minute read

The ATO has clarified some long-standing confusion about whether or not it is possible to reserve superannuation guarantee (SG) and salary sacrifice contributions.

Speaking to SMSF Adviser, AMP SMSF’s Peter Burgess explained that many have previously recommended this strategy should only be used for personal contributions which are claimed as a tax deduction, because with these contributions there are potentially more bases on which the trustee can argue the amount is unallocated.

“With an SG or salary sacrifice contribution it can only be a concessional contribution and only in respect of an employee of the employer so the trustee has less of a basis not to allocate the contribution to the member’s account,” Mr Burgess said.

However, AMP SMSF received guidance from the ATO last week which suggests the ATO is not concerned about the reasons why the contribution was not allocated.

“As long as this new form is used and proper records are kept, the reserving SG and salary sacrifice contributions is OK. It just means the application of a concessional contribution reserving strategy is perhaps much broader than first thought,” he said.

As reported in SMSF Adviser, the ATO has created a new system for SMSFs using a contribution reserving strategy with the release of a form titled Request to adjust concessional contributions, following complaints about costly and complex roadblocks to implementation.

 

Read more:

ATO getting tough on trustees who 'play the system'

Offshore investment hurting Australian economy: Hockey 

More good news for contribution reserves
smsfadviser logo
join the discussion

Do you think the government should reinstate the accountants’ exemption for SMSF advice?

SUBSCRIBE TO THE
SMSF ADVISER BULLETIN

Get the latest news and opinions delivered to your inbox each morning

In this month's issue:

  • Time wrap
  • The tech bull run
  • From hobby to passion
  • Golden Years
  • An untimely reminder
  • Why change is so difficult
  • Key Strategies for equalising super