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1998-2006

Superannuation: Key Dates (Part II)

April 2003

A recent decision by the High Court in Cook v Benson [2003] HCA 36 could help debtors seeking to use superannuation funds for asset protection.

In the February 2003 issue of Baldwins Bulletin, we outlined critical birthdates to diarise relating to accessing your superannuation benefits. We now detail below other dates of significance in the Superannuation laws, which impact on superannuation tax planning. Baldwins can advise impartially on superannuation planning strategies for clients.

Critical dates Significance of date
30 June 1983 Pre-30 June 83 component of ETP (i.e. lump sum benefit) taxed as to only 5% thereof.
30 June 1988 Capital Gains Tax introduced on Superannuation assets: valuation at 30 June 1988 became cost base for future CGT event.
1 July 1992 Commencement of the Superannuation Guarantee Administration Act prescribed minimum level of superannuation support which employers must provide for each of their employees (currently 9% of gross salary and wages).
30 June 1994 If a member elected to take an allocated pension prior to 30/06/1994, the pre June 83 component could be recognised as an “undeducted contribution” in determining that tax exempt element of the pension.
1 July 1994 Revision of Reasonable Benefit Limit (RBL) rules: introduction of flat dollar RBL amount (with indexation) and transitional RBL rules.
20 August 1996 Superannuation Surcharge potentially applicable to contributions made after 20 August 1996.
1 July 1999 Requirement for all new superannuation contributions to be preserved.
11 August 1999 Expansion of “in-house asset rules”, but with transitional provisions allowing some fund investments or leases to remain in place from that time without being subject to the new rules. New restrictions or exceptions in Part 8 include dealings with:
  • a lease or lease arrangement between the fund trustee and a related party;
  • nvestments in unit trusts;
  • business real property (for fund with fewer than 5 members); and
  • property owned by the fund and a related party as tenants in common.
21 September 1999
  • Concept of discount capital gain introduced. If superannuation fund holds asset for more than 12 months, a maximum tax rate of 10% applies – which is a 33.3% discount of the assessable capital gain instead of the usual 50% discount.
  • Introduction of Small Business Capital Gains Tax rules (including rollover to Superannuation fund).
1 July 2001 In-house assets: Some investments made between 12 August 1999 and 23 December 1999 would not count as “in-house assets” until 1 July 2001.
30 June 2009 In-house assets: transitional rules allowed additional investment in relation to pre-existing related party assets at the test time (11 August 1999) to remain until 30 June 2009, with some exceptions.

For further information, contact Joe Lederman at BALDWINS, Australian Lawyers & Consultants.

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