Excess contributions review welcome news

The Small Independent Superannuation Funds Association (SISFA) has welcomed news of an urgent review of excess contribution penalties as announced earlier this week by the Assistant Treasurer, Bill Shorten.

However, it stated it would like clarity on the issue before 30 June in order to allow self-managed superannuation fund (SMSF) investors to take action this financial year.

Despite this, SISFA urged SMSF practitioners to take immediate actions to prepare for a positive outcome from the review.

These actions included keeping a record of clients that have inadvertently exceeded contribution limits to discuss with the Australian Taxation Office when it is anticipated more sensible rules apply.

Also, it said to review contribution levels now of vulnerable clients who have chased maximum contributions and, where possible, unwind any excess contributions before 30 June.

SISFA director Andrew Cullinan urged members to raise any issues that should be covered by this review with the association as soon as possible.

“A quick response by the regulators to this urgent review should meant that practitioners and their SMSF trustee clients should have clarity over this contribution issue before 30 June to allow people to safely contribute for their retirement,” he said.