POWERED BY MOMENTUM MEDIA
SuperConcepts backs ECPI change
SuperConcepts’ general manager of education, technical services, Peter Burgess, has backed the 2017/18 simplification of the calculation of the exempt current pension income (ECPI) where a self-managed super fund (SMSF) is restructured during the course of the income year.
The change, which Burgess noted wasn’t legislated, but merely the Australian Taxation Office enforcing the correct application of the law, saw SMSFs identify each discrete period of segregation, and then only apply the actuary’s ECPI percentage to income derived during periods when assets were unsegregated.
“In the past, all we would do is apply the actuary’s ECPI percentage to all the income derived during the income year with no regard to whether the income was derived from segregated or unsegregated assets,” he said.
“I note recent calls by some parts of the industry for a return to the ‘good old days’, that is doing away with the need to identify discrete periods and just apply the actuary’s ECPI percentage to all the income derived by the fund during the income year.”
The legislation as it stands, he said, imposes a significant amount of complexity and cost, particularly for funds which may have multiple periods of segregation during the income year.
That approach though, has no material impact on the tax paid by the fund, and, arguably, is open to manipulation by clients timing the disposal of assets to coincide with a period when the fund assets were segregated pension assets.
“So I think there is merit in amending the law and allowing the industry to return to previous practices”, he said
Recommended for you
A member body representing some prominent wealth managers is concerned super funds’ dominance is sidelining small companies in capital markets.
Earlier this month, several Australian superannuation funds fell victim to credential stuffing attacks, which saw a small number of members lose more than $500,000.
Small- to medium-sized funds have become collateral damage in an "imperfect" model for super industry levies, a financial institution has said.
Big business has joined the chorus of opposition against the proposed Division 296 tax.
TOP PERFORMING FUNDS
ACS FIXED INT - AUSTRALIA/GLOBAL BOND
Fund name
3y(%)pa
1
DomaCom DFS Mortgage
90.28 3 y p.a(%)
2
GAM LSA Private Shares AU I
37.08 3 y p.a(%)
3
DomaCom Lot 21 Chellaston Road Munno Para West SA 5115 Australia
31.44 3 y p.a(%)
4
Fidante Credit Suisse Global Private Equity
31.12 3 y p.a(%)
5
Global X GlobalX FANG+ ETF
28.28 3 y p.a(%)
