The Minister for Revenue and Assistant Treasurer, Peter Dutton, today released for public comment draft regulations to support the Simplified Superannuation reforms.
“The Simplified Superannuation reforms are a real investment by the Government in the standard of living of Australians in retirement as well as the country’s future economic prosperity,” Mr Dutton said.
The draft regulations amend the Superannuation Industry Supervision Regulations 1994, Income Tax Assessment Regulations 1997, Superannuation (Self Managed Superannuation Funds) Supervisory Levy Imposition Regulations 1991 and Superannuation (Self Managed Superannuation Funds) Taxation Regulations 1999.
The draft regulations give effect to the changes to portability of benefits. The maximum timeframe in which a fund has to action a member’s request to transfer benefits will be reduced from 90 to 30 days.
“This is an important measure that compliments super choice. It will give Australian workers greater certainty when they choose to change superannuation funds that their money will be transferred promptly,” Mr Dutton said.
The Government has also been working with key stakeholders to develop a standardised form to use when transferring benefits between funds. The standard portability form is also available for comment.
The draft regulations also support the concessional and non-concessional contributions caps, and provide guidance to funds on the handling of member contributions made without a tax file number.
The Minister’s press release No. 008 of 7 February 2007 announced that the work test rules would be amended for a transitional period. The amendments will allow funds to accept personal contributions made by individuals who were aged 64 or 74 between 10 May 2006 and 5 September 2006 in certain circumstances. The amendments giving effect to this announcement are included in these draft regulations.
The draft regulations also improve the regulation of self managed superannuation funds, and improve the ability of the Commissioner of Taxation to assist trustees of self managed superannuation funds to comply with superannuation law. As previously announced, the supervisory levy is increased from $45 to $150 to better reflect the costs incurred by the Commissioner of Taxation in his role as Regulator.
The Tax Laws Amendment (Simplified Superannuation) Bill 2006 provides for regulations to set out the circumstances where a superannuation interest should be combined or separated. The draft regulations also ensure that different tax components of an interest are drawn down proportionally.
The draft regulations also specify the method for valuing a superannuation interest for the purposes of crystallising certain components of the interest prior to 1 July 2007.
The draft regulations insert a number of new definitions into the Income Tax Assessment Regulations 1997 including ‘superannuation income stream’, ‘superannuation income stream benefit’, ‘superannuation annuity’ and ‘roll over superannuation benefit’. These definitions are required to support the new minimum pension standards and new benefits provisions in the Tax Laws Amendment (Simplified Superannuation) Bill 2006.
The Government invites parties to provide comments on the draft regulations and draft standard portability form by 14 March 2007. The draft regulations and draft standard portability form are available from the website, http://simplersuper.treasury.gov.au
Comments can be sent to the following address:
General Manager
Superannuation, Retirement and Savings Division
The Treasury
Langton Crescent
PARKES ACT 2600
Email: simplersuper@treasury.gov.au