“Although we don't even have a bill in front of Parliament, I suspect we will receive the exact same bill as was put forward last year. I’m going to make an assumption that to save the government a lot of cost, time and effort, it is just going to reintroduce the same bill and it is going to apply from 1 July 2025.”

Johnson said although some trustees and advisers may wonder why measures should be put in place now, rather than when the bill is passed, he likened it to being appointed the executor of somebody's estate back dated to the date of death, even though they’re not appointed until four months after the member has died.

“Everyone's going to introduce tax effect accounting so that they will have a provision for capital gains tax, and there's nothing wrong with that if you're in accumulation phase.”

“If you're 45 years old, and you expect that all your assets will be there until you’re 60 or 65 when you start a pension, there is a chance you're going to sell that asset before you're 65, so tax effect accounting would make sense. But if you're in pension phase, you're not going to get away with providing for 15 per cent tax or 10 per cent tax on the sale of an asset.”

Johnson said it is also important to remember that the possible Div 296 tax liability must be paid by the individual.

“It's your bill. It's not your fund’s bill, just like Div 293 billed to the individual, [with Div 296] there is a Notice of Assessment issued to the individual. Think of excess contributions. Think Div 293 tax, you get the bill, but you can then get your release funds from super to pay that tax bill.”

“You can say you want the super fund to pay it, just like excess concessionals. You should also note that you don't get a tax deduction where your earnings are negative, but you can carry forward the negative earnings.”

He added that if the member dies, this means that if you have carried forward negative earnings, they may never materialise.

“You are paying tax on unearned income, and we've got to now plan for that and figure out how to deal with it.”

“I've had some clients who I have told about this, and they have said ‘Who cares?’, but I've got another client who has two cattle farms, with a total combined value of $25 million. They only make $300,000 a year.

“Now, imagine if their farm was in super now, paying $100,000 a year renting the farm, they're left with $200,000 for themselves, and their fund goes up $2 million for the year – it could almost send them broke, because they have to find the money to pay that tax, and the only way they could get that cash would be to sell the farm.

“They can't finance against it, because it's in super. If you take it out of super, you'll have capital gains tax. It really is going to create problems, but that's just the way it is. You need to consider what you’re going to do now.”