ATO consults on Transfer Balance Cap, transitional CGT relief guidelines

The ATO is consulting publicly on two Law Companion Guidelines for recent changes to superannuation – the Transfer Balance Cap and transitional CGT relief for superannuation funds around the Transfer Balance Cap and the changes to the income tax exemption for assets held by super funds relating to a Transition to Retirement Income Streams (TRIS).


The ATO has issued two draft Law Companion Guidelines, for consultation:

A Law Companion Guideline (LCG) is a type of public ruling, which sets out the ATO’s view on how a recently enacted law applies. The Treasury Laws Amendment (Fair and Sustainable Superannuation) Act 2016 recently passed the Parliament, and is waiting assent.

LCG 2016/D8 deals with the transitional CGT relief for super funds around the introduction of the Transfer Balance Cap and the removal of ECPI relating to TRISs.

“The object of the CGT relief provisions is to provide temporary relief from certain capital gains that might arise as a result of individuals complying with the transfer balance cap or TRIS reforms commencing,” says the ATO in the draft LCG.

LCG 2016/D9 deals with the Transfer Balance Cap (TBC), which limits the amount a person can transfer into pension phase – with transitional rules around the 1 July 2017 start date. The draft LCG discusses some of the new concepts, such as the general TBC and the personal TBC, as well as when credits or debits are made to a TBC account.

Due date for comments on the draft Law Companion Guidelines close 8 December 2016.

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