Income Tax Assessment Act 1997

CHAPTER 3 - SPECIALIST LIABILITY RULES  

PART 3-30 - SUPERANNUATION  

Division 292 - Excess non-concessional contributions  

Subdivision 292-C - Excess non-concessional contributions tax  

Operative provisions

SECTION 292-102   Downsizer contributions  

Criteria for a downsizer contribution

292-102(1)    
A contribution is covered under this section if:

(a)    

the contribution is made to a *complying superannuation plan in respect of you when you are aged 55 years or over; and

(b)    the contribution is an amount equal to all or part of the *capital proceeds received from the *disposal of an *ownership interest (the old interest ) in a *dwelling; and

(c)    you or your *spouse held the old interest just before the disposal; and

(d)    any *capital gain or *capital loss from the disposal of the old interest:

(i) for the case where you held it just before the disposal - is wholly or partially disregarded under Subdivision 118-B (or would have been if you had *acquired it on or after 20 September 1985); or

(ii) otherwise - would have been wholly or partially disregarded under Subdivision 118-B had you *acquired the old interest on or after 20 September 1985 and held it for a period before the disposal; and

(e)    the condition in subsection (2) is met for the disposal; and

(f)    the dwelling is located in *Australia, and is not a caravan, houseboat or other mobile home; and

(g)    the contribution is made within 90 days, or such longer period as the Commissioner allows, after the time the change of ownership occurs as a result of the disposal; and

(h)    you choose, in accordance with subsection (8) , to apply this section to the contribution; and

(i)    there is not already a contribution covered under this section, and made to a complying superannuation plan in respect of you, from an earlier choice you made in relation to the disposal of:

(i) another ownership interest in the dwelling that was not a related spousal interest to the old interest; or

(ii) an ownership interest in another dwelling.

Note 1:

Subparagraph (i)(i) does not prevent another contribution, made for you from the capital proceeds from the disposal of the same interest, from also being a contribution covered under this section.

Note 2:

That subparagraph also does not prevent another contribution, made for you from the capital proceeds from the disposal of a related spousal interest, from being a contribution covered under this section.

10-year ownership condition

292-102(2)    
The condition in this subsection is met for the *disposal of the old interest if either or both of the following paragraphs applies:

(a)    at all times during the 10 years ending just before the disposal:

(i) the old interest was held by you, your *spouse or your former spouse; or

(ii) an *ownership interest in the land on which the *dwelling is situated was held by you, your spouse or your former spouse;

(b)    if subsection 118-147(1) :

(i) applies because the old interest was a substitute property interest (within the meaning of that subsection) for an old dwelling referred to in paragraph 118-147(1)(a) ; or

(ii) would have applied as described in subparagraph (i) if paragraph 118-147(1)(a) were modified to refer to a dwelling (the old dwelling ) that was your main residence;

you, your spouse or your former spouse *acquired an ownership interest in that old dwelling at least 10 years before the disposal.

Note:

Section 118-147 deals with a dwelling replacing an earlier dwelling that was compulsorily acquired or destroyed etc.

Cap on the amount of a downsizer contribution

292-102(3)    
Despite subsection (1) , the contribution is covered under this section only to the extent that it does not exceed the lesser of:

(a)    $300,000, less any other contribution that is already covered under this section and made to a *complying superannuation plan in respect of you; and

(b)    the sum of the *capital proceeds from the disposals of:

(i) the old interest; and

(ii) any *related spousal interest to the old interest;

less the sum of all other contributions that are already covered under this section, in relation to the disposal of the old interest or any related spousal interest to the old interest, and made to complying superannuation plans in respect of you or your *spouse.

Market value substitution rule

292-102(3A)    
In working out *capital proceeds for the purposes of paragraph (1)(b) or (3)(b) , disregard section 116-30 to the extent that it has the effect of increasing those capital proceeds.

Meaning of related spousal interest

292-102(4)    
A related spousal interest , to an *ownership interest in a *dwelling, is another ownership interest in the dwelling if:

(a)    both ownership interests are *disposed of under the same contract; and

(b)    just before the disposal, you *held one of the ownership interests and your *spouse held the other.

When interest held by trustee of deceased estate

292-102(5)    
For the purposes of determining whether an individual held an interest at a particular time, if the interest was held at the particular time by the trustee of the deceased estate of an individual who was your *spouse when the individual died, the interest is taken to be held at the particular time by that individual.

Review of the period for making the contribution

292-102(6)    
If:

(a)    you requested the Commissioner to allow a longer period under paragraph (1)(g) ; and

(b)    you are dissatisfied with:

(i) a decision under that paragraph allowing a longer period; or

(ii) a decision the Commissioner makes not to allow a longer period;

you may object against the decision in the manner set out in Part IVC of the Taxation Administration Act 1953 .

292-102(7)    
To avoid doubt:

(a)    subject to subsection 14ZVC(3) of the Taxation Administration Act 1953 , you may also object, on the ground that you are dissatisfied with such a decision, relating to all or part of your contributions for a *financial year:

(i) under section 175A of the Income Tax Assessment Act 1936 against an assessment made in relation to you for the corresponding income year; or

(ii) under section 97-35 in Schedule 1 to the Taxation Administration Act 1953 against an *excess non-concessional contributions determination made in relation to you for the financial year; and

(b)    for the purposes of paragraph (e) of Schedule 1 to the Administrative Decisions (Judicial Review) Act 1977 , the making of a decision under paragraph (1)(g) of this section is a decision forming part of the process of making an assessment of tax, and making a calculation of charge, under this Act.

Requirements for choices

292-102(8)    
To make a choice for the purposes of paragraph (1)(h) , you must:

(a)    make the choice in the *approved form; and

(b)    give it to the *superannuation provider in relation to the *complying superannuation plan at or before the time when the contribution is made.

Commissioner to notify providers if contributions are not downsizer contributions

292-102(9)    
The Commissioner must, in writing, notify a *superannuation provider that all, or a specified part, of a contribution is not covered under this section if:

(a)    the Commissioner is aware that a choice referred to in subsection (8) has been given to the superannuation provider for the contribution; and

(b)    the Commissioner is satisfied that the contribution, or that part of the contribution, (as applicable) is not covered under this section.

The Commissioner may give a copy of the notification to *APRA.