Earlier in 2019 against the backdrop of an election, there were a range of measures impacting SMSFs and superannuation more broadly that we on a knife’s edge as to whether they would proceed – refer to our blog post ‘Super measures – what made it and what didn’t’ to read further.
With the Coalition re-instated into Government, it was expected that these measures would re-appear into Parliament with a view to finalise at some stage in 2019. Well, we have now seen Treasury Laws Amendment (2018 Superannuation Measures No. 1) Bill 2019 re-introduced into parliament on 24 July 2019.
Reintroduced super measures
The Bill focuses on three key measures:
- Amending the Superannuation Guarantee (Administration) Act (SGAA) 1992 to allow individuals to avoid unintentionally breaching their concessional contributions cap when they receive superannuation contributions from multiple employers. Instead of receiving contributions into superannuation, an employee may apply to the Commissioner to opt-out of the SG regime in respect of an employer and negotiate with the employer to receive additional cash or non-cash remuneration.
- To extend the purpose of the non-arm’s length income provisions to prevent the inflating of fund earnings through non-arm’s length dealings (e.g. schemes involving non-commercial arrangements that stream income to a SMSF). The strategy is used by some individuals to increase superannuation savings in a way that is not caught by the concessional contributions (CC) cap and non-concessional contributions (NCC) cap.
- To include within a member’s total superannuation balance (TSB) the outstanding loan amount of a limited recourse borrowing arrangement (LRBA) entered into by an SMSF after 1 July 2018. However, the increase only applies to members who have satisfied a condition of release with a nil cashing restriction, or those whose interests are supported by assets that are subject to an LRBA between the fund and its
associate (i.e. related party borrowing).
You can follow the progress of this Bill on the Parliament of Australia website.