Private ruling: Deductibility of personal superannuation contributions
Date of advice: 15 September 2016
Published: November 2016
Ruling period: Income year ended 30 June 2015.
Date scheme commenced: 30 July 2014.

Ruling: Q1: Is a person (the Taxpayer) entitled to a deduction for personal superannuation contributions made in 2014-15 income year under section 290-150 of the Income Tax Assessment Act 1997 (ITAA 1997) where the notice of intent to deduct was made outside the timeframes in subsection 290-170(1) of the ITAA 1997? | A1: No.

Relevant facts and circumstances: The Taxpayer is under 75 years of age. The Taxpayer is self-employed. The Taxpayer made a personal contribution (the contribution) into their superannuation fund (the Fund) during the 2014-15 income year. The contribution was paid in instalments towards the end of the 2014-15 income year. No notice of intent to deduct the contribution was submitted to the Fund prior to the end of the 2015-16 income year. As the notice of intent to deduct the contribution was not submitted before the end of the 2015-16 income year, the Fund has advised that the contribution in the 2014-15 income year is beyond the limit that they are able to process. The Taxpayer satisfies all other criteria for eligibility to claim a deduction on the contribution, those being: • Complying superannuation fund; • Maximum earnings as an employee; and • Age related condition. It is contended that as it was not the fault of the Taxpayer that the notice of intent to deduct was never submitted, the Taxpayer should be allowed to claim a deduction for the contribution. Rather, neither the Taxpayer's financial advisor nor their accountant submitted the notice of intent to deduct as a result of the Fund supplying the wrong information.

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(1).

Reasons for decision: Summary: The Taxpayer is not able to claim a deduction in the 2014-15 income year for the contribution as no notice of intent to deduct was provided to the Fund within the required timeframe. Further, it should be noted that there is no provision which enables the Commissioner to exercise his discretion to allow the deduction of a contribution where a valid notice of intent to deduct has not been provided on time. | Detailed Reasoning - Detailed Reasoning: Section 290-150 of the ITAA 1997 provides that an individual may deduct a contribution made to a superannuation fund for the purpose of providing superannuation benefits for themselves provided that certain conditions are met. Subsection 290-150(2) of the ITAA 1997 states that the conditions in sections 290-155, 290-160 (if applicable), 290-165 and 290-170 must all also be satisfied for an individual to deduct a contribution made in that income year. | Detailed Reasoning - Notice of intent to deduct conditions: Section 290-170(1) of the ITAA 1997 sets out the provisions for a notice of intent to deduct, and states: (1) To deduct the contribution, or a part of the contribution: (a) you must give to the trustee of the fund or the RSA provider a valid notice, in the approved form, of your intention to claim the deduction; and (b) the notice must be given before: (i) 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 (ii) otherwise - the end of the next income year; and (c) the trustee or provider must have given you an acknowledgment of receipt of the notice. The section states that, in order to deduct a personal contribution, a notice of intent to deduct must be provided to the trustee of the superannuation fund. Further, paragraph 290-170(1)(b) of the ITAA 1997 provides that this notice must be submitted to the Fund trustee on the earlier of: a. the date that an individual lodged their income tax return for the income year in which the contribution was made; or b. the end of the income year following the income year in which the contribution was made (in this instance being the 2015-16 income year). The Taxpayer made a personal contribution to their superannuation fund in the 2014-15 income year. However, no notice of intent to deduct was submitted by, or on behalf of, the Taxpayer before the end of the following income year. Neither section 290-170 nor any other section in the ITAA 1997 or the Taxation Administration Act 1953 give the Commissioner the discretion to allow a deduction for a superannuation contribution where the conditions have not been met. In addition, there is no discretion anywhere in the relevant legislation that would allow the Commissioner to vary or extend the time limit outlined in paragraph 290-170(1)(b) of the ITAA 1997. Accordingly, the Taxpayer is unable to claim a deduction for the contribution they made to the Fund in the 2014-15 income year as a valid notice of intent to deduct was not provided to the trustee of the Fund within the mandated time frame.