Government's superannuation reform package
On 11 November 2016, Minister for Revenue and Financial Services Kelly O'Dwyer gave a speech to the Association of Superannuation Funds of Australia conference. Key points of the speech includes:
- the Government's superannuation reform package including the plan to legislate the objective of superannuation and the introduction of flexibility measures to help people save for their retirement
- the release of a discussion paper by the Government this year which will explore the key policy issues for developing a framework for comprehensive income products for retirement
- the progress of the Productivity Commission review of the superannuation system's efficiency and competitiveness
- continuing to progress superannuation legislation previously before the Parliament, including choice of fund arrangements, independent directors on superannuation trustee boards and increased transparency in fund reporting of underlying assets and choice products.
Furthermore, in response to the subsequent passage through Parliament of the major superannuation reforms, which will generally commence from 1 July 2017, the ATO has issued the following draft Law Companion Guidelines for comment:
- LCG 2016/D8: Superannuation reform: transfer balance cap and transition-to-retirement reforms: transitional CGT relief for superannuation funds
- LCG 2016/D9: Superannuation reform: transfer balance cap
Comments are due on the above LCGs by 8 December 2016.
Public guidance products are currently under consideration by the ATO for a range of other issues relating to the superannuation reform package.
Labor's superannuation policy
The Labor Party has announced its revised superannuation reform package, which includes:
- lowering the annual non-concessional contributions cap to AUD75,000
- lowering the high income superannuation contribution (Division 293) threshold to AUD200,000 (the current Government proposal is to reduce this threshold to AUD250,000, and
- opposing other aspects of the Government's superannuation package, including the ability to catch up on concessional contributions and provisions to allow a tax deduction for personal superannuation contributions
During the passage of the Government's superannuation reform Bills in Parliament, these amendments were not passed.
Risk and Compliance the ATO's perspective
ATO Deputy Commissioner of Superannuation James O'Halloran delivered a speech to the ASFA National Superannuation Conference, highlighting the ATO's risk and compliance approach for superannuation. He also noted that a second series of foreign income tax offset reviews has commenced, and that the ATO is planning to issue Practical
Compliance Guidelines early next year regarding adoption of segregation and the movement of assets into the pension phase.