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To open this worksheet at Item D12-Personal Superannuation Contributions click the label or press [Enter] or click [Alt+S]. Alternatively, click Preparation > Schedule > Personal superannuation contributions (psc) worksheet.

You may only claim a deduction for personal superannuation contributions if you are eligible to do so. To assist in this process, a series of questions is asked. The answer to those questions will determine whether you may claim the deduction. The questions are self-explanatory.

If you have made eligible contributions to more than one complying superannuation fund or a retirement savings account, when you close the worksheet an Index will be provided from which you may create an additional entry.

 Click this link to the Individual tax return instructions on the ATO website for information on Personal Contributions. Also refer to the Super home page.

 

Tax Pre-fill

This schedule can be pre-filled using the Pre-fill Manager. The Pre-fill Manager enables you to download pre-fill reports for clients using the Practitioner Lodgment Service (PLS). You can view these reports in PDF format, and populate the pre-fill information into the client's Tax return. For more information on pre-filling, see Pre-fill Manager.

Tax Pre-fill is dependant on available ATO data. Validate the Tax return by pressing [F3] for a list of the imported values and any errors before lodgment.

Excess superannuation contributions

If you have exceeded either your Concessional superannuation contributions or your Non-concessional superannuation contributions and you have not taken up the ATO’s offer of the choice to withdraw the excess and pay the outstanding tax, then you will, at some stage, receive an Amended Assessment to pay the extra tax for the 2012 and 2013 income years.

Excess concessional superannuation contributions

On 29 June 2013 the Tax Laws Amendment (Fairer Taxation of Excess Concessional Contributions) Bill 2013 received Royal Assent.

The Act is designed to improve the fairness of the Excess Contributions Tax (ECT) system and provide greater choice by:

  • Taxing excess concessional contributions (ECC) at the individual’s marginal tax rate, plus an interest charge, rather than at the top marginal tax rate.

  • Allowing individuals to withdraw any amount, of up to 85% of their ECC, made from 1 July 2013 from their superannuation fund.

From October 2014, the ATO will begin to include the individual’s excess concessional contributions and interest charge amount on their individual tax return and issue an Amended Notice of Assessment to the taxpayer. Individuals will also be given a choice to withdraw any amount up to 85% of their excess concessional contributions from their super fund or funds to help pay the liability if they so choose.

Note this sentence is not quite correct, as what the ATO will do is to recalculate the taxable income of the previously lodged return and recalculate it in accordance with the increased income. This will affect the Adjusted Taxable Income for offset purposes, the Medicare Levy and Medicare Levy Surcharge.

If the individual decides to take up the option, they need to send the election form to the ATO who will then issue the release authority and statement to their nominated fund or funds. Any amounts of excess concessional contributions withdrawn from superannuation will not be counted towards the individual’s non-concessional contributions amount, while any excess concessional contributions not withdrawn will continue to be counted towards their non-concessional contributions.

Each FTECC election form will trigger the issuing of a release authority and statement to the nominated fund or funds. The statement and payment must be returned to the ATO within seven days. The release authority statement can be sent to the ATO via SBR, paper or fax. The ATO will then credit and refund to the individual any remaining amounts after taking into account any debts they may have.

Important Note: MYOB advises that income tax software providers do not have access to the information required to calculate either the revised Estimate of tax or the interest penalty applied and the Notice of Assessment will be issued without notice to the Tax Agent.

Excess Non-concessional contributions

Similar to Excess concessional contributions, the Government has recognised that a number of Australians are taxed punitively for genuine unintentional errors where their voluntary superannuation contributions exceed the non-concessional contributions cap (currently superannuation contributions in excess of the non-concessional contributions cap are taxed at the top marginal tax rate).

The Government announced in the 2014-15 Budget that it will allow individuals the option of withdrawing all superannuation contributions in excess of the non-concessional contributions cap and the associated earnings. If an individual chooses this option no excess contributions tax will be payable, with only the associated earnings to be taxed at the individual’s marginal tax rate. This measure will apply to contributions made on or after 1 July 2013.

This measure delivers on the Government's election commitment to address all inadvertent breaches of the contribution caps where the error would result in a disproportionate penalty.  

It achieves the Government’s objective in the most effective way and is broadly consistent with the treatment of contributions in excess of the concessional contributions cap. Final details of the policy will be settled following consultation with stakeholders in the superannuation industry.

The Legislation covering this topic can be found in the Tax and Superannuation Laws Amendment (2014 Measures No. 7) 2014 and Excess Exploration Credit Tax Bill 2014.

Method

The individual will be issued with a determination outlining the amount of excess non-concessional contributions and the calculated proxy earnings amount (the calculation method is still to be developed). The individual will decide how they want their excess contributions amount treated via an election form which will be issued with the determination.

The options are:

  • Withdraw the excess non-concessional contributions and associated proxy earnings from their superannuation fund. The proxy earnings will be determined by ATO systems and the proxy earnings amount will be included in the individual’s income tax return and taxed at their marginal tax rate.

    This last statement is not quite correct, as what the ATO will do is to recalculate the taxable income of the previously lodged return and recalculate it in accordance with the increased income. This will affect the Adjusted Taxable Income for offset purposes calculation, the Medicare Levy and Medicare Levy Surcharge.

  • If the individual chooses this option, they must send an election form to the ATO. The processing of the inbound election form will trigger the issuing of a release authority and statement to the nominated fund/s. Payment of the excess amount and proxy amount by the fund/s to the individual must occur within seven calendar days. In addition, the fund must also issue the release authority statement to the ATO within calendar seven days. The release authority statement can be sent to the ATO via PLS, paper or fax.

  • Pay excess contributions tax on the excess non-concessional contributions amount at the top marginal tax rate.

This will operate utilising the existing excess contributions tax regime.

The individual will be issued with a compulsory release authority which must be used to release the full amount of liability.