The Treasury Laws Amendment (2018 Superannuation Measures No 1) Bill 2019 was introduced in the House of Reps on Wed 24.7.2019 (and, at the time of writing, had not progressed pass first reading stage). It re-introduces measures in the similarly named 2018 Bill (which lapsed when Federal Parliament was prorogued for the Federal election).
See below for a summary of these measures.
The The Treasury Laws Amendment (2018 Superannuation Measures No 1) Bill 2019 introduces the following measures.
SGC OPT-OUT for employees with multiple employers – Schedule 1 of the Bill will amend the: Superannuation Guarantee (Administration) Act 1992 (SGAA) to enable certain employees with multiple employers to apply for an employer shortfall exemption certificate which prevents their employer from having a superannuation guarantee shortfall if they do not make contributions for a period. The opt-out means that eligible individuals can avoid inadvertently breaching their annual concessional contributions cap as a result of multiple employers making contributions into superannuation on their behalf. Instead of receiving contributions into superannuation, an employee may apply to the Commissioner to opt out of the superannuation guarantee regime in respect of an employer and negotiate with the employer to receive additional cash or non-cash remuneration. DATE OF EFFECT: the amendments apply in relation to quarters starting on or after 1 July 2018.
SUPER FUND NON-ARM’S LENGTH EXPENSES – Schedule 2 of the Bill will expand the non-arm’s length income (NALI) rules in s 295-550 of the ITAA 1997 so that non-arms length dealings that lower expenses and thus inflate assets within the concessionally taxed superannuation environment (in addition to the existing provisions, that assess the amount by which income is higher than an arm’s length amount). The new provisions will apply the top (45%) marginal rate to the amount by which expenses are lower than the arm’s length amount. DATE OF EFFECT: The amendments made by this Schedule apply in relation to income derived in the 2018-19 income year and later income years (even if the scheme was entered into before that time).
TOTAL SUPERANNUATION BALANCE & LRBAS – Schedule 3 of the Bill will make amendments centred on subdiv 307-D of the ITAA 1997 to ensure that, in certain circumstances, members with benefits supported by assets, funded by Limited Recourse Borrowing Arrangements (LRBAs), will have to include a proportion of the outstanding LRBA balance (being their share of the benefits supported by that Fund asset). This will only be for assets in an SMSF or ‘regulated superannuation fund’. It will apply to members who have satisfied a nil condition of release – which addresses the risk of using LBRAs to facilitate a re-contribution strategy. It similarly applies to members with a similarly funded benefit, where the LRBA is with an ‘associate’. The DATE OF EFFECT, for these amendments will be for new LRBAs entered on or after 1 July 2018 (and will not include refinancing of existing loans entered into prior to that date).