Delays with super proposals to have knock-on effects
The ability of SMSF practitioners to advise clients on their superannuation will continue to be hampered, with the Coalition still facing a lengthy negotiation over its proposals, says the SMSF Academy’s Aaron Dunn.
Mr Dunn says the issues around the key measure on budget night – the $500,000 non-concessional lifetime cap – is still unresolved, with the Coalition government trying to negotiate with backbenchers on whether that number should be $500,000 or higher, or whether it should be backdated or prospective.
“The Coalition is going to have to dig a big deeper and negotiate. The Greens have obviously stated some of their positions... and [they’ll have to deal] with some of the independent senators,” Mr Dunn said.
“The reality is we’re about to hit September and this stuff was announced in May. Individuals wanting to engage with super and provide advice around it are frustrated by the length of time that it’s taken.”
Mr Dunn said this is already affecting the ability of SMSF practitioners to help their clients plan in a number of different areas of advice, which will only worsen with further delays.
“There really needs to be some sort of definitive framework that we can move towards so that practitioners can start to advise the clients of what needs to happen this year, whether it’s amendments to pensions or changing salary sacrificing arrangements in readiness for 1 July next year. There’s a significant amount of planning that has to go on,” he said.
Mr Dunn said the delays are also impacting on individuals attempting to get their LRBAs on non-commercial terms by the 31 January 2017 deadline.
While an exemption has been announced by the government for those who had entered property contracts, the uncertainty around the proposals still makes it difficult for many trustees to get their LRBA on the correct terms.
“With the Coalition still trying to decide if the cap will be $500,000 or $750,000 or if it will be retrospective, it only allows individuals or trustees who need to resolve existing LRBAs to meet the safe harbours in a short amount of time,” Mr Dunn said.
“We may end up being in the same situation as we were when the ATO set the original 30 June deadline.”
Miranda Brownlee is the deputy editor of SMSF Adviser, which is the leading source of news, strategy and educational content for professionals working in the SMSF sector.
Since joining the team in 2014, Miranda has been responsible for breaking some of the biggest superannuation stories in Australia, and has reported extensively on technical strategy and legislative updates. Miranda has also directed SMSF Adviser's print publication for several years.
Miranda also has broad business and financial services reporting experience, having written for titles including Investor Daily, ifa and Accountants Daily.