Australians will be allowed to claim back up to $10,000 in excess super contributions, following recent action by the Government.
Regulations were enacted last week to allow an estimated 30,000 Australians to benefit from the refund of certain excess concessional contributions, said a Treasury statement.
Individuals that are eligible for the excess concessional contribution refund can only make the most of this offer once, and can receive a maximum of $10,000.
The excess concessional contributions will be assessed as income for the year of the excess contributions rather than subject to excess contributions tax. This applies to contributions made since 1 July 2011.
In announcing the enactment of the new regulations, Minister for Financial Services and Superannuation Bill Shorten took the opportunity to criticise the Coalition’s superannuation policies.
"In addition to the refund measure, the Gillard Government is also committed to raising the concessional caps. The Coalition has no plans to raise the concessional caps," he said
Any excess contributions that are refunded will be released to the Australian Tax Office (ATO), which will “typically then provide any refund to the individual after any personal income tax is paid,” said the treasury statement.
"The refund offer will be automatically offered to eligible individuals by the ATO, and funds will be able to use existing administrative processes. This will minimise the compliance cost on the industry and individuals," said Shorten.
The refund measure was announced in the 2011/12 budget, and the regulations were enacted at last week’s meeting of the Executive Council.
The changes are contained in the Superannuation Industry (Supervision) Amendment Regulation 2012 (No. 3) and the Retirement Savings Accounts Amendment Regulation 2012 (No. 2).
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