{"id":1125,"date":"2017-07-24T05:23:50","date_gmt":"2017-07-24T05:23:50","guid":{"rendered":"http:\/\/actinvest.com.au\/?p=1125"},"modified":"2017-07-24T05:23:50","modified_gmt":"2017-07-24T05:23:50","slug":"tens-of-thousands-of-smsfs-at-risk-with-ecpi","status":"publish","type":"post","link":"https:\/\/actinvest.com.au\/index.php\/tens-of-thousands-of-smsfs-at-risk-with-ecpi\/","title":{"rendered":"\u2018Tens of thousands\u2019 of SMSFs at risk with ECPI"},"content":{"rendered":"<p><em>The Actuaries Institute has addressed the ATO with significant concerns about a recent interpretation related to<\/em><strong><em> exempt current pension income (ECPI), <\/em><\/strong><em>fearing many\u00a0SMSFs\u00a0will make incorrect claims as a result.<\/em><\/p>\n<p style=\"text-align:center\"><img loading=\"lazy\" alt=\"\" height=\"268\" src=\"http:\/\/www.plannerweb.com.au\/images\/smsf-at-risk.jpg\" width=\"400\" \/><\/p>\n<p>\u00a0 \u00a0 \u00a0 \u00a0<\/p>\n<p>\u00a0<\/p>\n<p>In a letter to the tax office, copying in minister for revenue and financial services Kelly O\u2019Dwyer, the institute referred to the ATO\u2019s recently confirmed view that if an SMSF was fully in pension phase for any part of a tax year, it cannot use the unsegregated method for all of its assets for the whole of that tax year.<\/p>\n<p>Rather than having a choice over whether to segregate certain assets to support pension liabilities, this interpretation assumes assets are \u2018deemed\u2019 to be segregated at a point in time if the fund\u2019s only superannuation liabilities are in respect of account based type pensions, the letter said.<\/p>\n<p>\u201cThis will force many funds to use two different methods, the segregated and unsegregated methods, to claim ECPI in the same income year, adding administrative complexity. The Actuaries Institute is concerned that this interpretation is at odds with long standing industry practice, potentially putting tens of thousands of funds at risk of claiming ECPI incorrectly,\u201d the letter said.<\/p>\n<p>\u201cWe also believe that the ATO\u2019s interpretation does not reflect the policy intent and will add significantly to the compliance costs of funds claiming ECPI with no clear gain to tax revenues.\u201d<\/p>\n<p>The institute has recommended the ATO re-considers its position to allow long standing administrative practices to continue.<\/p>\n<p>\u201cIf the ATO believes there is no alternative interpretation than their current view we request clarification be sought from Treasury and that, if necessary, the legislation be amended to match established practice,\u201d the institute said.<\/p>\n<p>\u201cGiven the uncertainty this is causing in the industry, we also recommend that the ATO clarifies that it will not be requiring funds to comply with this new interpretation for the 2017 and 2018 income years.\u201d<\/p>\n<p>Speaking to SMSF Adviser, general manager of Accurium, Doug McBirnie, said he hopes this latest lobbying effort will pave the wave for a quick resolution.<\/p>\n<p>\u201cWe are very pleased to see the Actuaries Institute address this issue with the ATO on behalf of the SMSF industry. The ATO\u2019s recent guidance on this has put actuarial certificate providers in a difficult position and created uncertainty for SMSF practitioners and their clients,\u201d he said.<\/p>\n<p>\u00a0<\/p>\n<p>KATARINA\u00a0TAURIAN<br \/>\n13 Jul 2017<br \/>\nwww.smsfadviser.com<\/p>\n","protected":false},"excerpt":{"rendered":"<p><em>The Actuaries Institute has addressed the ATO with significant concerns about a recent interpretation related to<\/em><strong><em> exempt current pension income (ECPI), <\/em><\/strong><em>fearing many\u00a0SMSFs\u00a0will make incorrect claims as a result.<\/em><\/p>\n","protected":false},"author":1,"featured_media":1126,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":[],"categories":[4],"tags":[],"_links":{"self":[{"href":"https:\/\/actinvest.com.au\/index.php\/wp-json\/wp\/v2\/posts\/1125"}],"collection":[{"href":"https:\/\/actinvest.com.au\/index.php\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/actinvest.com.au\/index.php\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/actinvest.com.au\/index.php\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/actinvest.com.au\/index.php\/wp-json\/wp\/v2\/comments?post=1125"}],"version-history":[{"count":1,"href":"https:\/\/actinvest.com.au\/index.php\/wp-json\/wp\/v2\/posts\/1125\/revisions"}],"predecessor-version":[{"id":1127,"href":"https:\/\/actinvest.com.au\/index.php\/wp-json\/wp\/v2\/posts\/1125\/revisions\/1127"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/actinvest.com.au\/index.php\/wp-json\/wp\/v2\/media\/1126"}],"wp:attachment":[{"href":"https:\/\/actinvest.com.au\/index.php\/wp-json\/wp\/v2\/media?parent=1125"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/actinvest.com.au\/index.php\/wp-json\/wp\/v2\/categories?post=1125"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/actinvest.com.au\/index.php\/wp-json\/wp\/v2\/tags?post=1125"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}