In some cases, rounding has been applied to eliminate cents and simplify the calculations.
John is a member and a trustee of an SMSF. His account balance at 1 July 2021 is $200,000. Included in this balance are John's personal contributions of $100,000. He has not given a notice of intention to deduct any of these contributions using a Notice of intent to claim or vary a deduction for personal super contributions form (NAT 71121), so they are a tax-free component for income tax purposes.
First rollover
In March 2022, John makes another non-deductible personal contribution of $95,000. This brings the value of John's super interest to $295,000, with a tax-free component of $195,000.
In April 2022, John rolls over $60,000 to Fund ABC and leaves $235,000 in his SMSF. John's SMSF provides Fund ABC with an RBS message via SuperStream reporting tax and contributions information as follows.
Completing the RBS message in SuperStream when the rollover is made
Tax components
Using the proportioning rule, John calculates the tax-free component of his rollover as the 'Rollover amount' multiplied by the result of the 'Tax-free component of his super interest before the rollover' divided by the 'Value of his super interest before the rollover', that is:
$60,000 × ($195,000 ÷ $295,000)
The taxable component of his $60,000 rollover is the remainder of the rollover:
$60,000 − $39,661 = $20,339
|
Tax-free component |
$39,661 |
|
Taxable component: |
|
|
$20,339 |
|
|
John needs to calculate how much of his personal contributions made in the 2021–22 financial year remain in the SMSF after paying the rollover to Fund ABC.
The tax-free component of his interest left in the SMSF is the tax-free component before the rollover minus the tax-free component rolled out:
$195,000 − $39,661 = $155,339
The taxable component is the remainder of his interest in the fund – that is, the total in the SMSF after the rollover minus the tax-free component after the rollover:
$235,000 − $155,339 = $79,661
|
What |
Reported at |
Amount |
|---|---|---|
|
Tax-free component |
Item 13 |
$39,661 |
|
Taxable component: |
||
|
Element taxed in the fund |
Item 13 |
$20,339 |
After the rollover has been made, the balance of John's super interest in the SMSF is $235,000, which is made up of:
- Tax-free component: $155,339
- Taxable component: $79,661
Additional contributions and second rollover made during the year
In May 2022, John received employer contributions of $2,000 and made additional non-deductible personal contributions of $45,000. There is a $300 allowance for tax on employer contributions. This brings the value of John's super interest to $281,700 ($235,000 + $2,000 + $45,000 − $300).
John's super interest is now made up of a:
- tax-free component of $200,339 (the $155,339 tax-free component in the fund before the contribution plus the personal contribution of $45,000)
- taxable component of $81,361 (the $79,661 taxable component in the fund before the contribution plus the $1,700 net amount of employer contributions).
In June 2022, John rolls over a further $80,000 to Fund ABC and leaves $201,700 in his SMSF. When the rollover is made, John's SMSF provides Fund ABC with an RBS reporting tax and contributions information as follows.
Completing the RBS message in SuperStream when the rollover is made
Tax components
Using the proportioning rule, John calculates the tax-free component of his $80,000 rollover as the 'Rollover amount' multiplied by the result of the 'Tax-free component of his super interest before the rollover' divided by the 'Value of his super interest before the rollover', that is:
$80,000 − ($200,339 ÷ $281,700) = $56,894
The taxable component of his $80,000 rollover is the remainder of the rollover:
$80,000 − $56,894 = $23,106
|
Tax-free component |
$56,894 |
|
Taxable component: |
|
|
Element taxed in the fund |
$23,106 |
|
Element untaxed in the fund |
|
John calculates the components of his remaining super interest in the SMSF ($201,700) as follows.
The tax-free component of his interest left in the SMSF is the tax-free component before the rollover minus the tax-free component rolled out:
$200,339 − $56,894 = $143,445
The taxable component of his interest left in the SMSF is the remaining interest in the SMSF minus the tax-free component remaining in the SMSF:
$201,700 − $143,445 = $58,255
Completing the SMSF annual return after the end of the financial year
Prior to completing section F of the SAR, John must ensure that he has all the details relating to the contributions that have been made to his SMSF during the financial year, together with the details of amounts rolled out of his SMSF to other funds on a RBS.
John must report on the SAR details of the contributions received by the SMSF and the rollover amounts:
|
Opening account balance |
$200,000 |
|
Label A – Employer contributions |
$2,000 |
|
Label B – Personal contributions |
$140,000 |
|
Label N – Total contributions |
$142,000 |
|
Label O – Allocated earnings or losses |
$300 (Loss) |
|
Label P – Inward rollover amounts |
Nil |
|
Label Q – Outward rollovers and transfers |
$140,000 |
|
Label R – Benefit payments and code |
Nil |
|
Label S – Closing account balance |
$201,700 |
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