Below is a round-up of some superannuation changes and key developments that may be relevant to your SMSF. It is important that you know what changes are coming, so you can effectively understand how they may affect your SMSF. We intend to regularly provide you with these updates as a way of helping you plan for your retirement and identify any opportunities that can assist you to grow your superannuation savings.
Deductibility of personal super contributions and the work test
Since 1 July 2022, there has been a law change that abolished the requirement for anyone aged between 67 and 75 to satisfy a work test – or be gainfully employed – before making superannuation contributions. That is unless you want to claim a tax deduction for a personal super contribution – which still requires you to meet the work test or rely on the one-off work test exemption.
However, an unintended consequence of this law change has been that some individuals, despite no change in their employment arrangements, may no longer be entitled to a tax deduction. For example, some company directors aged 67 to 75 may be impacted.
To resolve this issue, the ATO has released a draft Legislative Instrument (LI 2023/D11) which is intended to ensure that all individuals aged 67 to 75, who would have been eligible to claim a tax deduction for their personal superannuation.
SuperStream Rollover relief is ending
From 1 July 2023, all trustees will need to have an Electronic Service Address (ESA) and to use the SuperStream system to successfully roll over member benefits. This means all SMSFs actioning a member rollover will be required to receive and send electronic messaging and payments.
Undertaking a rollover without using an ESA after 30 June 2023 will result in a contravention, reportable by your SMSF auditor. Since March 2022, SMSF trustees that had difficulty getting an ESA have been able to seek approval from the ATO to roll over member benefits to an APRA-regulated fund (or to another SMSF), outside of the SuperStream system. Given the number of messaging providers now available and the small number of trustees that needed to seek approval from the ATO, this temporary relief is now set to end on 30 June 2023.
Please note that all Shakes SMSF clients have been provided with an ESA.
If you would like further information about SMSF superannuation updates, please contact our specialist advisors on 9321 2111.
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