The Minister for Financial Services and Superannuation on Fri 3.8.2012 released for public consultation draft legislation to provide income tax relief for merging superannuation funds. This measure provides temporary taxation relief in the form of loss relief and CGT and revenue asset roll-over for merging super funds.
The draft legislation proposes to amend the ITAA 1997 and the Tax Laws Amendment (2009 Measures No 6) Act 2010 to reinstate Div 310 containing the temporary loss relief for merging superannuation funds with some modifications. The modifications:
- provide an optional asset roll-over for capital gains and revenue gains;
- provide that losses that are transferred to the receiving entity will be treated as having been made in the income year that they were transferred; and
- exclude self-managed superannuation funds from the changes.
The loss relief and asset-roll-over are designed to remove income tax impediments to mergers between complying super funds by permitting the roll-over of both revenue gains or losses and capital gains or losses. This loss relief will be available for complying superannuation funds (other than SMSFs) and approved deposits funds (ADFs) that merge with a complying superannuation fund with 5 or more members.
DATE OF EFFECT: The changes would apply for mergers that occur on or after 1 October 2011 and before 2 July 2017.
COMMENTS are due by 24 August 2012.
[LTN 149, 3/8]