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Remove excess super contribution penalties: SPAA
The Self-Managed Super Fund Professional’s Association of Australia (SPAA) has urged industry and the Government to work together to remove harsh penalties for super fund investors who mistakenly make excess super contributions.
The chief executive of SPAA, Andrea Slattery, said the Government should redraft the Superannuation Industry Supervision (SIS) regulations to allow excess super contributions to be refunded without tax penalties. Currently, the refund option available under the SIS Act only applies in situations where the non-concessional contribution is itself in excess of the cap.
Slattery recently called for transitional relief for self-managed super fund (SMSF) trustees caught up in an inadvertent breach of the concessional contribution caps. The call came in response to an alert by the Australian Taxation Office warning SMSF members not to use trust clauses in SMSF trust deeds that attempt to restrict super contributions in excess of the current super caps.
Penalties can be as high as 93 per cent for excess super contributions.
“A long-term solution to the issue of excess super contributions tax requires a package of legislative reform and calls on the industry to join together to push for this reform,” Slattery said.
Slattery also called for concessional caps to be returned to their pre-2009 levels, allowing taxpayers to increase their retirement savings.
AUTHOR
Mike Taylor
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