It is less clear whether this will result in a lowering of overall fees and charges. However, the discontinuation of the superannuation surcharge is not without its disadvantages, including that:. The ALP has signalled that it would oppose the recently announced tax cuts. These tax cuts include the abolition of the superannuation surcharge from 06 onwards. The Democrats have expressed concern that Parliamentarians will be significant beneficiaries of the discontinuation of surcharge from 1 July For that financial year and following years.
Part 1 of Schedule 1 amends the Superannuation Contribution Tax Assessment and Collection Act , Superannuation Contributions Tax Members of Constitutionally Protected Superannuation Funds Assessment and Collection Act and the Termination Payments Assessment and Collection Act to effectively limit the payment of the superannuation surcharge to superannuation contributions and eligible termination payments made in respect of the financial years 97 to Items 4, 5 6 and 7 in Part 2 of Schedule 1 limit the application of the surcharge regime to various Commonwealth Superannuation Funds to the period commencing 1 July and ending 30 June These amendments are all consequent on the amendments made in Part 1 of Schedule 1 of the Bill.
The amending legislation does not simply repeal the entire suit of superannuation surcharge legislation. Retaining the Acts that impose the surcharge as amended by this Bill allows:. These collections take place from October More importantly, maintaining the legislation maintains equity in the superannuation system. Simply abolishing superannuation surcharge from 1 July would result in defined benefit fund members, to whom the surcharge would have applied, to not pay this tax. This outcome would be unfair as accumulation fund members have paid this tax in respect of contributions made on their behalf or if self employed tax deductible contributions made between 97 and An eligible termination payment is a payment made as a consequence of the termination of employment.
The bulk of eligible termination payments are made up of superannuation lump sums. The Hon. Total income for surcharge purposes is made up of tax assessable income, superannuation contributions, fringe benefits if any and eligible termination payments if any.
If a contribution to a superannuation fund is tax deductible that means that the amount contributed is not included in either the business assessable income for tax purposes, or, in the case of the self employed, their personal assessable income for tax purposes. Australian Tax Forum 18 4 : Source Title Australian Tax Forum.
Faculty Curtin Business School. Collection Curtin Research Publications. Related items Showing items related by title, author, creator and subject. An analysis of Australian mutual fund performance and market relationships. Pojanavatee, Sasipa Mutual funds are emerging as an opportunity for investors to automatically diversify their investments in such a way that all their money is pooled and the investment decisions are left to a professional manager.
Please try again later. The Sydney Morning Herald. June 1, — 7. Save Log in , register or subscribe to save articles for later.
Interest is added to the surcharge debt account based on the outstanding balance at 30 June each year using the year Treasury bond rate. You can choose to make a voluntary payment to the ATO at any time to reduce the balance of your surcharge debt account.
However, you may be disadvantaged by making a payment before your final liability is calculated. The ATO calculates your final liability after we lodge a super member exit statement for your constitutionally protected fund.
The ATO will send you a notice of final liability. You will need to pay this amount within three months. We recommend that you seek professional advice before making any voluntary payments to the ATO.
We provide a facility for you to make the surcharge payment in a tax-effective manner. You can authorise us to withhold part of your final benefit to meet your surcharge liability. This amount will be deducted tax free from your final benefit so you can pay your surcharge liability to the ATO. It will be held in a surcharge liability account. If you wish to take advantage of this facility, please complete the relevant Benefit access form for your account.
You can also fill out our Retirement Income Pension application form.
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