The Tax Office has released its SMSF News (Edition 27) indicating that it will start issuing the first assessments for the new Division 293 tax in January 2014 for individuals above the $300,000 high-income threshold for the 2012-13 financial year.
The Tax Office said it will determine who is liable to pay the Div 293 tax by adding together an individual’s income for surcharge purposes and low tax contributions. If these amounts total more than $300,000, the Tax Office said the individual is liable to pay the extra 15% Div 293 tax on their “low tax contributions” (essentially concessional contributions). The Commissioner said Div 293 tax debts generally need to be paid 21 days after receipt of the notice of assessment, although there may be a part of the Div 293 tax debt that is deferred. Deferred debts are attributed to defined benefit accounts and do not need to be paid until the end benefit is taken from defined benefit funds. Importantly, the Tax Office noted that there are no additional requirements for the SMSF annual return in respect of the Div 293 tax.
The Tax Office also said that the first payments of the Government’s low income superannuation contributions (LISC) up to $500 are likely to be made to super funds from September 2013 for members who have lodged their 2012-13 tax return before then.
Other topics covered in the ATO’s SMSF News include: the SMSF levy; SMSF annual returns; changes to related party transactions not proceeding; appointment of SMSF auditors; the independent auditor’s report and auditor contravention reporting instructions.
[LTN 160, 20/8/13]