Refunding excess non-concessional contributions bill passed

Refunding excess non-concessional contributions, Tax and Superannuation Laws Amendment (2014 Measures No. 7) Bill 2014The Tax and Superannuation Laws Amendment (2014 Measures No. 7) Bill 2014 has passed the Parliament, changing the treatment of excess non-concessional contributions.

After receiving assent the bill will create a system for refunding excess non-concessional contributions made in the 2013/14 or later financial years, along with 85% of associated earnings. The grossed up (100%) associated earnings are included in the individual’s assessable income for the year in which the contribution was made, with a 15% non-refundable tax offset.

Guidance needed on refunding excess non-concessional contributions: ASFA

ASFA refunding excess non-concessional contributionsASFA broadly supports the reforms for refunding excess non-concessional contributions. However the industry body, in a submission to the treasury consultation process, says there are some areas of the draft legislation which requires further guidance.

“ASFA believes that the proposed amendments are consistent with the policy objective that delivers on the Government’s election commitment to develop an appropriate process that addresses inadvertent breaches of the contribution caps,” says the submission.

“ASFA has participated in extensive discussions with Treasury and the Australian Taxation Office (ATO) on the design of both the law and the administrative arrangements.”