Tax Question - Personal Super Contributions

[trading_rookie]

I am helping out an old mate of mine with their super and have discovered that they made a personal contribution to super many, many years ago but never claimed it as a tax deduction.

My friends accountant has stated it's too late to make a claim now but if he talks to his superfund and informs them no claim was made, that they will get back the 15% tax paid to the ATO.

Is that correct?

 

[Trembling Hand]

I am helping out an old mate of mine with their super and have discovered that they made a personal contribution to super many, many years ago but never claimed it as a tax deduction.

My friends accountant has stated it's too late to make a claim now but if he talks to his superfund and informs them no claim was made, that they will get back the 15% tax paid to the ATO.

Is that correct?

Call the ATO. If they can't answer that over the phone they will tell you what to do to find out.

 

[kincella]

super contribution was limited to 5000 and or only about 75% was deductible...its changed over the years...or it might have been a 3000 limit...for the self employed...
think it could not be claimed if you also had employer sponsored super...

did they pay tax in the superfund on the contribution ???
just wonder if he missed it in his return...was it also missed in the superfund return...
might pay to advise what year and how much he paid...then check if the fund paid the tax on the contribution
I am a bit rusty on this....but find out what year it was first...

 

[trading_rookie]

Thanks guys for your replies.

@Trembling Hand, agree with your suggestion, just hoping someone might know before I call the ATO. As we all know, the ATO fields a lot of questions a day and I don't have the time to wait...but it might come down to that ;-)

@kincella, yes the superfund deducted 15% from the contribution for tax purposes. As for missing it in his tax return, not possible since the superfund has to send out a form/you request a form for the taxable deduction and at the time he was under the impression the form he received from the fund was only for those retiring and having accessing to their super.

I haven't hassled him too much as he runs an SME and spends long hours of the day doing finance, sales&marketing and couriering (one man band)
so he was expecting/relying on the Financial Adviser who setup his super account to inform him of such matters...afterall, they had no problem helping themselves to multiple trailing commissions from a one-off personal contribution.

The payment was in 1999 and my research on the net has led me to a document that states that personal contributions made on or after 1 July 2007, a tax notice must be meet certain conditions:
(a) submitting the income tax return for the financial year in which the contribution was made.
etc, etc.

Which poses the obvious, what about those pre-2007?

 

[kincella]

so I gather he does not manage the superfund...how much money are we talking about in tax ??? amount contributed by 15%.....
if its less than 1000 it will just sit there as a credit in his super account...
10 years seem a long time to be going back
alternatively I would tell the superfund....never claimed the tax deduction for the original amount..so this year when I make the contribution...I will claim the tax deduction...but the superfund not pay tax...that way you are even...
otherwise you are looking at trying for an amended assessment for his personal return for the 1999 year....not sure if they will go back that far...its usually only 5 years...
there was 3000 and claim for 75% of the balance....
going back a bit far for me now
hope this helped
guess you just call the super hotline
cheers

 

[trading_rookie]

I was thinking along the lines of labelling the contribution as an 'undeducted contribution'. Since he's a self-employee who didn't claim a tax deduction he qualifies under this description.

The advantage being an undeducted contribution is not subject to 15% contributions tax. Therefore he should get it back as a transfer into his superfund. We're talking about $1500.

Do you think that will work and more importantly satisfy ATO criteria?

 

[kincella]

is it 1500 in contribution or 1500 tax

 

[trading_rookie]

1500 tax

 

[kincella]

Ok I would call the ATO and see if they will allow an amended return for the year in question..if yes...put in the claim..if not write to the superfund and advise the circumstances...or better still call them...
if he was making another 10.000 contribution explain the situation to have the tax on this one exempt
its worth chasing 1500 in tax but only he does it and not pay fees to another....his accountant should have been able to advise him
thats it..go back to the accountant ..if they are still working together
whichever way...either the fund should credit his account with 1500..or the ATO...but its 10 years...

 

[trading_rookie]

According to his tax accountant it's not possible to amend the 1999 tax return, so no luck there.

If he contacts his superfund, what's he expecting from them? And I wonder how willing they'll be to help? As you say $1500 is worth chasing even if it was 10 yrs ago.

Would you expect the superfund to get the $1500 and transfer it back into his super portfolio? Or would it mean if his portfolio made a gain then CGT would be exempt to a limit of $1500?

Am I correct in labeing it an undeducted contribution, even though 15% contribution tax was paid by his superfund to the ATO but he's never claimed the taxable portion?

Finally, how willing will the ATO be in providing a refund?