Private ruling: Personal superannuation contributions
Published: January 2014
Ruling period: Year ended 30 June 2011
Date scheme commenced: 1 July 2010

Ruling: Q1: Can your client vary a valid notice in respect of the personal superannuation contribution made for the 2010-11 income year? | A1: No

Relevant facts and circumstances: In the 2010-11 income year, your client made a personal contribution to a complying superannuation fund (the Fund) with the intent to claim the full amount as a tax deduction. In the 2010-11 income year, your client provided a notice of intent to claim a deduction for personal superannuation contributions to the trustee of the Fund. The notice of intent to claim a deduction for the 2010-11 income year was received and duly acknowledged by the trustee of the Fund. When your client's 2011 income tax return was being completed by the accountant it became apparent that your client's assessable income was insufficient to claim the full amount of personal contribution as a deduction. Due to unforseen events your client was unable to lodge their income tax return for the 2010-11 income year until late in the 2012 year. Your client's assessable income was less than the full amount of the 'notice of intent to claim a deduction' for the 2010-11 income year. Your client claimed the deductible personal superannuation up to their assessable income. Your client requested the Fund to amend the deductible personal contribution. Your client was advised by the trustee of the Fund that they are unable to amend the contribution amount because the contribution was made more than 12 months after the year when the contribution was initially made.

Relevant legislative provisions: Income Tax Assessment Act 1997 section 290-150 | Income Tax Assessment Act 1997 section 290-170 | Income Tax Assessment Act 1997 section 290-180 | Income Tax Assessment Act 1997 Subsection 290-180(2) | Income Tax Assessment Act 1997 Subsection 290-180(3) | Income Tax Assessment Act 1997 Subsection 290-180(3A)

Reasons for decision: Summary: Your client cannot vary a valid notice as the requirement under section 290-180(3) has not been satisfied. That is, your client lodged her income tax return for the 2010-11 income year after the end of the next income year. | Detailed Reasoning - Detailed reasoning: A person can claim a deduction for personal contributions made to a superannuation fund for the purpose of providing superannuation benefits for themselves under section 290-150 of the Income Tax Assessment Act 1997 (ITAA 1997). Subdivision 290-C of the ITAA 1997 lists four conditions that must be satisfied for the person to claim an income tax deduction for the contributions. One of these conditions is the member must have given a valid notice of intent to the superannuation fund or retirement savings account (RSA) provider in the approved form by the required time and have received an acknowledgement from the fund trustee or the RSA provider (section 290-170 of the ITAA 1997). In this case the 'notice of intent to claim a deduction' was lodged correctly and was duly acknowledged so that condition of Subdivision 290-C of the ITAA 1997 was satisfied. In accordance with section 290-180 of the ITAA 1997 a person can vary a 'notice of intent to claim a deduction' by giving a 'notice to vary' to the trustee in the approved form. However, section 290-180 lists a number of restrictions to lodging a 'notice to vary' as follows: 290-180(2) You can vary a valid notice, but only so as to reduce the amount stated in relation to the contribution (including to nil). You do so by giving notice to the trustee or the RSA provider in the approved form. 290-180(3) However, you cannot vary a valid notice after: (a) if you have lodged your income tax return for the income year in which the contribution was made on a day before the end of the next income year - the end of that day; or (b) otherwise - the end of the next income year. 290-180(3A) The variation is not effective if, when you make it: (a) you were not a member of the fund or the holder of the RSA; or (b) the trustee or *RSA provider no longer holds the contribution; or (c) the trustee or RSA provider has begun to pay a *superannuation income stream based in whole or part on the contribution. For the circumstances of this case, a closer examination of subsection 290-180(3) of the ITAA 1997 is as follows: | Detailed Reasoning - Notice of intent to deduct conditions: One of these conditions, in section 290-170 of the ITAA 1997, is that the person making a contribution must provide a valid notice of intent to claim a deduction (the notice) to their superannuation fund. In respect of the 2010-11 income year, that notice of intent must be given to the fund by the earlier of: · 30 June 2012, or · the day on which their 2010-11 income tax return is lodged. As mentioned previously, the 'notice of intent to claim a deduction' was lodged correctly and was duly acknowledged by the trustee of the Fund in the 2010-11 income year. Accordingly, the notice of intent requirement has been satisfied. | Detailed Reasoning - Varying a notice of intent to claim a deduction: Section 290-180 of the ITAA 1997 states that a notice may be varied but not revoked or withdrawn. However subsection 290-180(3) states that you cannot vary a valid notice after you have lodged your income tax return for the income year in which the contribution was made. The Australian Tax Office (ATO) records indicate that your client's income tax return for the 2010-11 income year was received by the ATO after 30 June 2012. As your client's income tax return was lodged after the end of the next income year (i.e. the 2011-12 income year) therefore it is too late for your client to give the 'notice to vary' to the trustee of the Fund. There is no provisions in the ITAA 1997 that allow the Commissioner to vary or extend the date by which a valid notice for the purposes of section 290-170 of the ITAA 1997 given to the trustee of Fund.