Private ruling: Superannuation financial planning
Published: April 2013
Ruling period: Year ended 30 June 2012
Date scheme commenced: 1 July 2011

Ruling: Q1: Are you entitled to claim the expenses associated with financial advice for your superannuation fund? | A1: No.

Relevant facts and circumstances: You are self employed. After you commenced your business you approached your superannuation fund to set up an investment plan for superannuation. You were referred to a financial planner and a plan was drawn up at a cost which was not claimed as a tax deduction. Later, a review of this plan was carried out and you paid for this.

Relevant legislative provisions: Income tax Assessment Act 1997 Section 8-1.

Reasons for decision: Summary: Section 8-1 of the Income Taxation Assessment Act 1997 (ITAA 1997) allows you to deduct from your assessable income any loss or outgoing to the extent it is incurred in gaining or producing assessable income. The question of the deductibility of ongoing management fees is determined under section 8-1 of the ITAA 1997. The Commissioner's view on the deductibility of ongoing management fees was originally set out in Taxation Ruling IT 39 and subsequently in Taxation Determination TD 95/60. In both instances it was determined that where such fees were incurred in servicing an existing investment portfolio the cost was deductible to the extent that the portfolio produced assessable income. Although not specifically stated in the determination it was an inherent part of the decision that the assessable income referred to would be the assessable income of the taxpayer and not the assessable income of some other taxpayer such as a superannuation fund. In your case, the funds contributed to superannuation are held by your superannuation fund in trust for you. You do not derive any income from investments that the superannuation fund makes. No income is assessable income in your hands as any income earned by the fund is assessable income to the fund. Accordingly, no deduction is available under section 8-1 of the ITAA 1997 for any of the fees you incur in managing the financial plan for your superannuation fund.