From 1 July 2013, any excess concessional superannuation contributions are automatically included in an individual’s assessable income and taxed at their marginal tax rate (plus an interest charge).
Individuals can elect to release up to 85% of their excess concessional contributions from their superannuation fund to the Tax Office as a “credit” to cover the additional personal tax liability. If the individual completes an election form to release an amount, the Tax Office will issue the nominated super fund with an excess concessional contributions release authority. The super fund will be required to pay the amount to be released to the Tax Office, as well as return the release authority statement within 7 days.
The Commissioner is not expected to start issuing individual income tax notices of assessment containing excess concessional contribution amounts, and the associated election forms, before November 2014. As a result, associated release authorities and statements are unlikely to issue to super funds before December 2014, the Tax Office said in its SMSF News (Edition 32), October 2014.
[LTN 212, 3/11/14]