David Busoli, principal of the SMSF Alliance, said the anomaly impacts those between 65 to 75 years and is a consequence of the removal of the work test.
“Be aware of a quirk in claiming unclaimed super monies where the member is between 65 and 75 because the amount is unrestricted and non-preserved, the ATO will expect to be paying it into the member’s personal account as a member benefit,” he said.
“If they are provided with the super fund’s bank account number, in the expectation that it will constitute a rollover, the fund will receive it as a member contribution.
“Since the work test has been removed, the fund is unable to reject it so it will be counted against the member’s non-concessional cap. This raises the possibility that it might inadvertently trigger either an excess contribution or the three-year bring forward provision.”
Mr Busoli said this anomaly will not happen with an APRA-regulated fund but is principally an SMSF problem as trustees provide their fund’s bank details.
“I don’t know if the ATO will actually rollover this contribution once you’re 65,” he said.
“I was not aware of the problem until recently when a client of mine said the unclaimed super had been rolled over but there was no documentation attached to it from the ATO.
“I realised if you were under 65, that documentation would have been supplied which raised the alarm for me.
“If you have someone to make non-concessional contributions then it’s not huge problem if it gets paid into their fund but for others, because of their total super balance, they are unable to make further NCCs and they don’t want the payment paid to them – they want it to be rolled over.
“It means you will have to take particular care in those cases so that you don’t inadvertently take money out of the super environment that you didn’t intend to be taken out.”
