News › Weekly Alert Article
Proposed loss transfer regime for superannuation funds
In December 2008, Senator Nick Sherry, then Minister for Superannuation and Corporate Law, announced that the Government would introduce a temporary tax measure to assist in the consolidation of superannuation funds. The apparent goal behind the measure is to allow the industry to merge into fewer, more efficient, larger and presumably more stable funds by removing some of the tax impediments to consolidation.
The announcement proposed an optional loss transfer system for any net capital losses that resulted from the CGT events that would be triggered by the merger of an existing fund into an APRA-regulated fund. The Tax Brief below examines the many refinements to that proposal that occurred during the last eight months culminating, earlier this month, with the release by Treasury of Exposure Draft legislation.
There are a number of technical requirements in the rules which are already creating headaches, and it seems quite likely that there will have to be further modifications.
The legislation exists at present in Exposure Draft form. A formal Bill to enact these measures is expected in Parliament shortly and - it is important to note - may differ from the proposals outlined in this Tax Brief.
Your Taxand contact for further queries is:
T. +61 2 92 25 59 57