Anthony Cullen, senior technical educator for Accurium, said in a recent quarterly technical update that there are times when an NOI may not be valid, such as if the superannuation fund no longer holds the contribution of a particular member, the individual is no longer a member of a particular fund or where the member has started a pension.
“I have seen situations in the past where a client has set up an SMSF and automatically rolled their fund from an APRA account without lodging a Notice of Intent and that will have an impact on the amount they potentially can claim as a deduction, depending on how much money is left in the account,” he said.
“The other one in the SMSF space is that we’ve all got clients that start pensions on 1 July so they must lodge an NOI and complete the trustee acknowledgement before the pension is commenced otherwise they will not be able to lodge an NOI at all.”
He added that any variations to the notice of intent also need to be lodged within the specified time frames and those variations can only vary the amount down.
“If you want to increase the amount that the individual is claiming as a deduction, you can lodge a second NOI. You can have more than one NOI per member,” he said.
Cullen gave an example of a member who had made a contribution in February 2023, and who had lodged their NOI and received an acknowledgement, then a couple of weeks later there was a request by the member to start a pension.
“The trustees accepted the request and lodged the TBAR with the ATO within the required timeframe in the financial year. The fund’s return was lodged based on the fact there was an NOI to claim a deduction,” he said.
“However, when the member lodged their personal return it was determined they did not have enough income to be able to claim a deduction. The question was asked if they could go back and amend the fund’s financial records as they did not want the amount to be a concessional contribution, but a non-concessional contribution.”
Cullen said an important fact to remember regarding NOIs is that when signing the official ATO declaration form, there is a point that stipulates that the super fund has not begun to pay a superannuation income stream.
“The fact that the fund had started the pension means it was not able to put in a variation of notice which then creates problems,” he said.
“That amount then remains as a concessional contribution as far as the superannuation fund is concerned and will be assessable, and the likelihood is that there will be tax paid on that assessable income.”
