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COVID-19: The ATO announces further superannuation measures

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Further to the COVID-19 superannuation measures that we discussed here, the Australian Taxation Office (ATO), on 3 April 2020, announced further details around, and new measures concerning, COVID-19 and superannuation.

Requesting an extention for lodgement of the 2018/19 SMSF annual return

The ATO announced that SMSF trustees or their tax agents can request an extention for lodgement of SMSF’s 2018/19 annual return, if they require more time due to COVID-19. Tax agents can apply for the lodgement deferral to up to 30 June 2020 provided they contact the ATO to request the extension before 15 May 2020.

Superannuation guarantee amnesty

The ATO announced it will work with businesses who apply for the superannuation guarantee amnesty to enter into payment arrangements if they have difficulty making payments because of COVID-19. In order to qualify for the amnesty an application must be made by 7 September 2020.

Employers adversely affected by COVID-19 can make payment arrangements with the ATO. These arrangements include:

  • flexible payment terms and amounts which the ATO will adjust if circumstances change; and

  • extending the payment plan beyond 7 September 2020. However, only payments made by 7 September 2020 will be deductible.

Those employers who are still unable to adhere to these payment arrangements would be disqualified from the amnesty and would not be able to benefit from the amnesty. However:

  • the disqualification will only apply to any unpaid quarters;

  • the ATO will tell the employer which quarters are unpaid. For these quarters, the ATO will re-apply the administration component of $20 per employee included in the disqualified quarter; and

  • the ATO will also take the employer's circumstances into account when deciding whether a Part 7 penalty should be applied to its disclosure, and a review of its circumstances may result in the penalty being reduced (including to nil).

Some employers may be eligible to receive a refund because of the amnesty. In such a situation:

  • for those who lodged a super guarantee charge (SGC) statement between 24 May 2018 and 6 March 2020, the ATO is amending their returns as quickly as possible so that any refunds can be paid; and

  • those who have made payments of SGC or contributions to employee super funds in the 2018 or 2019 income years would be eligible for income tax deductions. These employers should include this deduction in their tax return for the relevant year. Once the ATO has amended their return it will pay any refund due as soon as possible. Generally, within 14 days.

Early release of superannuation

The ATO has explained how it will administer the measure to allow for early release of superannuation in response to COVID-19.

On Monday 20 April, the ATO will release the application form for individuals to use for COVID-19 early release of super. From that date, individuals can begin applications.

An individual can make one application in the 2019/20 income year and one application in the 2020/21 income year prior to 24 September 2020, when the measure ends.

Individuals can make an application in one of two ways:

  • the member authenticates themselves through myGov and can complete the application in ATO Online;

  • for those who are unable to access online services, the individual will be able to call the ATO, confirm their identity and complete the application over the phone.

The ATO says it will take approximately 1 to 2 business days for the fund to receive notifications about members. Funds can expect to start receiving notifications from Tuesday 21 April 2020.

For more information contact:

Phil Broderick
Principal
T +61 3 9611 0163  l M +61 419 512 801   
E: pbroderick@sladen.com.au           

Melissa Colaluca
Senior Associate
T +61 3 9611 0161
E: mcolaluca@sladen.com.au

Phil Broderick