Private ruling: Non-concessional contributions cap - bring forward provisions
Published: December 2012
Ruling period: 1 July 2012 to 30 June 2015
Date scheme commenced: 1 July 2012

Ruling: Q1: 1. Have you made non-concessional contributions in excess of the non-concessional contributions cap in any of the 2007-08, 2008-09, 2009-10, 2010-11 or 2011-12 income years and triggered the 'bring forward' provisions under subsection 292-85(4) of the Income Tax Assessment Act 1997 (ITAA 1997)? 2. Will you trigger the 'bring forward' provisions under subsection 292-85(4) of the ITAA 1997 in the 2012-13 income year? 3. Can you make personal contributions of up to $450,000 between 1 July 2012 and 30 June 2015 without exceeding the non-concessional contributions cap? Advice/Answers: 1. No. 2. Yes. 3. Yes.


Relevant legislative provisions: Income Tax Assessment Act 1997 Subsection 292-20(2). | Income Tax Assessment Act 1997 Subsection 292-85 | Income Tax Assessment Act 1997 Subsection 292-85(2). | Income Tax Assessment Act 1997 Subsection 292-85(3). | Income Tax Assessment Act 1997 Subsection 292-85(4).

Reasons for decision: Summary: You have not triggered the 'bring forward provisions' up until the 2011-12 income years. The bring forward provisions will be triggered in the 2012-13 income year if you go ahead with your proposed non-concessional contributions in this income year. Based on the figures which you have provided, you can contribute a further amount over three years and not exceed the non-concessional contributions cap of $450,000.00 up until the 2014-15 income year. | Detailed Reasoning - Detailed reasoning: The Bring Forward Provisions Subsection 292-85(2) of the Income Tax Assessment Act 1997 (ITAA 1997) states that a taxpayer's non-concessional cap for the year is three times their concessional contribution cap for the 2007-08 and the 2008-09 income years. As the concessional contribution cap for the 2007-08 and the 2008-09 income years is $50,000, the non-concessional contributions cap for the 2007-08 and the 2008-09 income years income year is $150,000. Further, the section states that the non-concessional contributions cap is six times the concessional contributions cap for the 2009-10 and later income years. Therefore the cap is six times $25,000 which equals $150,000. However, subsection 292-85(3) and (4) of the ITAA 1997 ('the bring-forward provisions') provide that the non-concessional contributions cap is calculated differently if certain conditions are satisfied. The conditions specified under subsection 292-85(3) of the ITAA 1997 are: · the non-concessional contributions for the first year exceed the amount in subsection (2) for that year; and · the taxpayer is under 65 years at any time in the first year; and · a previous calculation of the cap under the bring forward provisions does not determine the taxpayer's non-concessional cap in the first year. The Commissioner confirms the amount of non-concessional contributions you have made in the 2007-08, 2008-09, 2009-10 and 20110-11 income years as stated in the facts. The Commissioner has not received a form from Fund A for the 2011-12 income year and is therefore unable to confirm the contribution made by you. However, it is accepted that you have made that contribution. You will be under 65 years of age in the 2012-13 income year. Furthermore as the 2007-08 income year was the bring-forward provision's first year of operation and as you have not exceeded the non-concessional contributions cap from 2007-08 income year until the 2011-12 income year, the bring-forward provisions have not been triggered. Therefore, if you make non-concessional contributions during the 2012-13 income year that exceed the non-concessional contributions cap specified under subsection 292-85(2) of the ITAA 1997 (currently $150,000), the bring-forward provisions apply and your non-concessional cap would be calculated in accordance with subsection 292-85(4). You have advised an estimate of non-concessional contributions in Fund A, you have made non-concessional contributions to Fund B and you intend to make a further non-concessional contributions to Fund B all in the 2012-13 income year. These will be made prior to you reaching age 65. Therefore, you will make sufficient non-concessional contributions to trigger the bring-forward provisions as the annual cap of $150,000.00 in the 2012-13 income year will be exceeded. As a result and based on the figures you have provided, you can contribute a further amount and not exceed the non-concessional contributions cap of $450,000.00 over three years i.e. up until the 2014-15 income year.

Please check this edited version to be sure that there are no details remaining that you think may allow you to be identified. Contact us at the address given in the fact sheet if you have any concerns. | Relevant facts: You are over 55 years of age and a full time employee. | You have provided your employer with a notice of resignation to take effect in the 2012-13 income year. | You are on a period of extended leave until your resignation takes effect. | You have three superannuation accounts, one with Fund A and two with Fund B. | You have provided the non-concessional contributions made to both Fund A and Fund B in the in the 2007-08, 2008-09, 2009-10, 20110-11 and 2011-12 financial years. | You have provided an estimate of the amount of the non-concessional contributions to be made and the amount you have made into the two Funds in the 2012-13 financial year.