In a decision handed down on Thur 28.3.2013, the AAT has held that excess non-concessional contributions tax assessments issued to a taxpayer should stand.
The taxpayer was a member of the Trantino Superannuation Fund. On 26 August 2009, the Fund lodged an amended Member Contributions Statement, stating that in the financial year ended 30 June 2007, the taxpayer had made non-concessional contributions of id=”mce_marker”m, and that employer contributions had totalled $210,226. The employer contributions comprised id=”mce_marker”05,113 from Construction Engineering (Aust) Pty Ltd (a trustee of the Construction Engineering Unit Trust) (“CEA”) and id=”mce_marker”05,113 from Murdunna Nominees Pty Ltd (trustee of the V Trantino Family Trust) (“Murdunna”). The taxpayer was a director of both CEA and Murdunna. The parties agreed that CEA and Murdunna were associates as defined in s 318 of the ITAA 1936.
The taxpayer sought a review of an objection decision by the Commissioner which assessed his excess non-concessional contributions for the year ended 30 June 2007 at id=”mce_marker”05,113. As a consequence, the taxpayer was required to pay excess non-concessional contributions tax of $48,877.50 for the income year.
The Tribunal said the effect of the application of 292-20(6)(b) of the Income Tax (Transitional Provisions) Act 1997 was that the contributions made by separate employers, who were associates of the taxpayer for the purposes of former s 82AAC(1) of the ITAA 1936, must be aggregated as required by former s 82AAC(2). The consequence was that the taxpayer’s deduction limit within the meaning of s 82AAC(2A) was exceeded. On this interpretation, which in the Tribunal’s opinion was “the only logical interpretation”, the contributions of CEA and Murdunna had to be aggregated for the purposes of s 292-80(5)(b) of the Transition Act. The AAT said it therefore followed that s 292(6)(b) applied and that those contributions, as aggregated, exceeded the taxpayer’s deduction limit of id=”mce_marker”05,113 by the sum of id=”mce_marker”05,113, thereby confirming the Commissioner’s decision.
(AAT Case [2013] AATA 178, Re Trantino and FCT, AAT, Hughes M, 28 March 2013.)
[LTN 60, 28/3/13]