The submissions made by Tax and Super Australia, and those we make with selected joint parties, are an important aspect of the advocacy work that we do for our members as we strive for favourable outcomes for the industry.
Below you will find the three most recent advocacy efforts undertaken by Tax and Super Australia.
1. 2022-23 pre-budget submission
Tax and Super Australia and The Self-managed Independent Superannuation Funds Association (SISFA) have submitted a 2022-23 pre-budget joint submission to the government in relation to a range of superannuation matters.
We believe there are a number of measures that can be introduced by the government that will reduce red tape and help stimulate economic activity. We also believe there are a number of bigger-picture issues in the superannuation system that should be reviewed.
Some of the key measures we are advocating for include:
• Non-arm’s length income rules should be made proportionate
• Consolidating superannuation thresholds into one single threshold
• Provide consistency in how various thresholds are indexed
• Breaches of regulation 13.22D of the SIS Regs should be rectifiable
• Fixes to the binding death benefit nomination system
• Quick fixes to the superannuation guarantee system
• Remove the auto non-compliance for breaching section 17A of the SIS Act and failing to be an Australian super fund
• Streamline the personal superannuation contribution deduction process
• Transfer balance account reporting (TBAR) reporting should be annual for SMSFs
• Abolition of the work test for personal deductible contributions
• Legacy pension amnesty should be extended, and
• Other areas of the superannuation system that require review
2. Streamlining transfer balance cap event-based reporting arrangements for SMSFs
Tax and Super Australia and SISFA provided a joint submission to the ATO in January 2022 on streamlining the transfer balance cap event-based reporting arrangements for SMSFs.
We believe that reporting transfer balance events to the ATO is an important process. Our view is that transfer balance account reporting (TBAR) should remain on an annual basis, whilst still providing SMSFs with the option to report events as they occur rather than waiting for the due date. Moving to an annual reporting framework would reduce red tape and allow SMSFs to complete all their reporting at once – eg tax return, financial statements and TBAR.
Despite our preference for annual reporting, if the current quarterly regime is retained, we believe that SMSFs should be given until 1 July 2023 to report events to the ATO to allow SMSFs sufficient time to adjust to the more frequent quarterly reporting regime.
It is hoped the ATO will provide their final guidance on this matter shortly once all submissions have been considered in detail.
3. Joint submission on superannuation non-arm’s length income rules
Tax and Super Australia is part of a larger industry group (The Joint Bodies) which is in ongoing consultation with the ATO and Treasury regarding the non-arm’s length income (NALI) provisions.
The Joint Bodies wrote to Senator Jane Hume, Minister for Superannuation, Financial Services and the Digital Economy in early September 2021 seeking an urgent amendment to the superannuation NALI provisions.
One of the main aims of this larger working group is to remove unintended NALI provisions. Rather than NALI applying blanketly to all income tainted by non-arm’s length dealings, The Joint Bodies believe that NALI should apply proportionately.
Examples of that application include:
- If under non-arm’s length dealings, a superannuation fund acquires an asset for 10% below market value, then NALI should apply to 10% of the income and gains from that asset (ie, not 100%).
- If a related party of a superannuation fund fails to charge an arm’s length fee of $10,000 in management fees for managing a superannuation fund asset, then NALI should apply to $10,000 (ie, not all of the income and gains from that asset).
The Joint Bodies believe that the upcoming budget is an ideal time to announce that the NALI rules will be fixed. We are still hopeful that we will see some changes to the NALI rules and will keep you informed once a decision has been reached.
The Joint Bodies making this request were:
• Tax & Super Australia
• Chartered Accountants Australia & New Zealand
• CPA Australia
• Institute of Public Accountants
• The Tax Institute
• Australian Superannuation Funds Association
• SMSF Association
• National Tax and Accountants Association
• Self-Managed Independent Superannuation Funds Association
• Financial Planning Association of Australia
• Actuaries Institute
