Private ruling: Deductibility of personal superannuation contributions
Date of advice: 23 August 2017
Published: December 2017
Ruling period: Income year ended 30 June 2016
Date scheme commenced: 1 July 2015

Ruling: Q1: Is the Taxpayer entitled to claim a deduction for personal superannuation contributions made under section 290-150 of the Income Tax Assessment Act 1997 (ITAA 1997)? | A1: Yes

Relevant facts and circumstances: The Taxpayer is retired from work and not employed in any capacity. The Taxpayer made a personal superannuation contribution to the Fund. The Taxpayer’s assessable income comprised of: ● pension income; ● interest income; ● proceeds from the sale of property; ● investment income; and ● long service leave entitlements. The Taxpayer has provided the Fund a valid notice of intent to claim a deduction for the contribution made and the Fund has provided acknowledgment of receipt of the notice.

Relevant legislative provisions: Income Tax Assessment Act 1997 Section 290-150 | Income Tax Assessment Act 1997 Section 290-155 | Income Tax Assessment Act 1997 Section 290-160 | Income Tax Assessment Act 1997 Section 290-165 | Income Tax Assessment Act 1997 Section 290-170 | Income Tax Assessment Act 1997 Section 290-175

Reasons for decision: Summary: The Taxpayer has satisfied the requirements for claiming a deduction for the personal superannuation contribution made to the Fund. | Detailed Reasoning - Deduction for personal superannuation contributions: A person must satisfy the conditions in section 290-150 of the ITAA 1997 before they can claim a deduction for personal contributions made to a superannuation fund for the purpose of providing superannuation benefits for themselves. Subsection 290-150(2) of the ITAA 1997 provides that the conditions in sections 290-155, 290-160, 290-165 and 290-170 of the ITAA 1997 must also be satisfied. | Detailed Reasoning - Complying superannuation fund condition: The condition in section 290-155 of the ITAA 1997 requires that where the contribution is made to a superannuation fund, it must be made to a complying superannuation fund for the income year in which the contribution is made. As the Fund is a complying superannuation fund, this requirement will be satisfied. | Detailed Reasoning - Maximum earnings as an employee condition: The condition in section 290-160 of the ITAA 1997 requires that if a taxpayer is engaged in any activities that result in them being treated as an employee for the purposes of the Superannuation Guarantee (Administration) Act 1992 (SGAA), then less than 10% of the total of the following must be attributable to those activities: ● their assessable income for the income year; ● their reportable fringe benefits (RFB) for the income year; and ● the total of their reportable employer superannuation contributions (RESC) for the income year. The Taxpayer was not engaged in any 'employment activities’ that would make them an employee for the purposes of the SGAA. Accordingly, the Taxpayer will not be subject to the 'maximum earnings test’ under section 290-160 of the ITAA 1997. | Detailed Reasoning - Age-related condition: Under subsection 290-165(2) of the ITAA 1997, contribution must be made on or before 28 days after the end of the month the Taxpayer turns 75. As the Taxpayer was under the age of 75, this condition is met. | Detailed Reasoning - Notice of intent to deduct conditions: Subsection 290-170(1) of the ITAA 1997 requires a valid notice of intent to be provided to the trustee of the Fund and for the trustee to provide acknowledgement of receipt of the notice. The Taxpayer has provided a valid notice of intent and received acknowledgment of receipt. | Detailed Reasoning - Deduction limited by amount specified in notice: Subsection 290-175 of the ITAA 1997 states that the deduction cannot be more than the amount covered by the notice given under section 290-170 of the ITAA 1997. Provided the amount of the deduction claimed does not exceed the amount specified in the notice of intent to claim a deduction, this requirement will be satisfied. As all of the above conditions have been satisfied, the Taxpayer will be able to claim a deduction for the personal superannuation contribution made to the Fund.