Transfer balance account data needs to be made more available

The SMSF Alliance has called for Treasury to provide funding to the Australian Taxation Office (ATO) to allow superannuation members to access their transfer balance accounts outside its own software.

The SMSF Alliance said currently the only way a member’s transfer balance account could be accessed was through the member directly and through the member’s personal tax agent, and not the tax agent for self-managed superannuation funds.

The alliance’s principal and SMSF specialist mentor, David Busoli, said: “There is no ability for this data to be fed to any purpose-built software outside of the ATO so there is no simple way for advisers and administrators to keep on top of the problem.

“It’s bad enough now, it will be much worse come July 1. It’s past time for Treasury to release the necessary funding for the ATO to provide this facility.”

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On 1 July, 2021, the indexation of the general transfer balance cap (TBC) would occur, meaning there would be an increase of the general TBC from $1.6 million to $1.7 million.

The ATO said once indexation of the general transfer balance occurred, there would be no single TBC which applied to all individuals.

Busoli said confusion would be the primary result of the change as member specific TBCs would be the norm and confusion would be exasperated by the lack of ability for the ATO to provide the data.

On the new rules, the ATO said: “An individual who starts their first retirement phase income stream on or after indexation, will have a transfer balance cap of $1.7 million.

“An individual who already had a transfer balance account and who at any time met or exceeded the $1.6 million transfer balance cap will not be entitled to indexation and their personal transfer balance cap will remain at $1.6 million.

“For every other individual, their entitlement to indexation will be based on identifying the highest ever balance in their transfer balance account and using this information to calculate the proportional increase in their transfer balance cap and applying that new personal transfer balance cap to their affairs going forward. These individuals will have a personal transfer balance cap somewhere between $1.6 million and $1.7 million.

“We will do this calculation when indexation occurs based on the information received and processed by us at this time. We will use and display what we consider the individual’s personal transfer balance cap to be. After indexation ATO online services (and online services for agents) will be the only place an individual who had a transfer balance account prior to indexation will be able to see their personal transfer balance cap.”