Significant changes to the taxation of superannuation transfers into Australia spell good news for individuals and superannuation funds, Minister for Revenue and Assistant Treasurer, Senator Helen Coonan announced today.
"Growth in offshore superannuation benefits transferred into Australia more than six months after the individual becomes a resident will be treated as a taxable contribution in the superannuation fund, and thus taxed at a concessional rate," Senator Coonan said.
"Importantly, the superannuation fund will pay the tax on behalf of the individual.
"Superannuation accumulated overseas and transferred into Australia within six months of the individual taking up residency remains tax free on transfer. The changes will encourage the transfer of superannuation into Australia, which is good for individuals and good for funds."
The Minister's announcement comes as part of the Government's response to the Senate Select Committee's Report into the Taxation of Overseas Superannuation Transfers.
Currently individuals pay tax on the growth amount at their marginal rates of tax without having access to their superannuation benefit.
"The Government will consult with the superannuation industry and interested parties to finalise the detail of the recommended change and to ensure there are no unintended consequences of such a change," Senator Coonan said.
Legislation to give effect to the change will be brought forward as soon as possible.
"The Government has also committed to improving taxpayer understanding and awareness of the provisions for the taxation of overseas superannuation," Senator Coonan said.