Superannuation Contributions Determination

SCD 98/6

Superannuation contributions: what are the surchargeable contributions threshold and the indexable amounts for the 1998-99 financial year under the Superannuation Contributions Tax Imposition Act 1997?

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FOI status:

1. The Superannuation Contributions Tax Imposition Act 1997 (the Act) provides that for each financial year the surchargeable contributions threshold and the indexable amounts are to be amounts which reflect movements in full-time adult average weekly ordinary time earnings (AWOTE).

Surchargeable contributions threshold

2. In accordance with subsection 6(2) of the Act, the surchargeable contributions threshold is the amount worked out using the formula:

previous threshold x indexation factor x (current charge percentage / previous charge percentage)


3. The previous threshold is the surchargeable contributions threshold for the financial year immediately before the relevant financial year. Under subsection 6(1) of the Act, the surchargeable contributions threshold for the 1997-98 financial year was $2,092.

4. The indexation factor is worked out under subsections 9(4) and (5) of the Superannuation Contributions Tax (Assessment and Collection) Act 1997. This factor is calculated by dividing the index number for the last quarter in the current March year by the index number for the last quarter in the previous March year. The index number for a quarter is the AWOTE estimate for the middle month of the quarter published by the Australian Statistician. The Australian Statistician's AWOTE estimate for February 1998 was $721.30 and the estimate for February 1997 was $696.10. This produces an indexation factor of 1.036.

5. For the 1998-99 financial year, the current charge percentage - the number that is the employer's charge percentage under the Superannuation Guarantee (Administration) Act 1992 for the relevant financial year - is 7. The previous charge percentage - the number that is the employer's charge percentage under that Act, for the financial year immediately before the relevant financial year - is 6.

6. Applying the formula in paragraph 2, the surchargeable contributions threshold for the 1998-99 financial year is:

Indexable amounts

7. In accordance with subsection 7(1) of the Act, each indexable amount is worked out using the formula:

previous indexable amount x relevant indexation factor.


8. The previous indexable amount is the indexable amount for the financial year immediately before the indexing financial year. The indexing financial year is the 1998-99 financial year or a later financial year. For the purpose of this Determination, the previous indexable amounts, as advised by Superannuation Contributions Determination SCD 97/4, are $1,046; $73,220 and $88,910.

9. The relevant indexation factor is the indexation factor for the indexing financial year and is calculated in the same way as described in paragraph 4 above. The factor is 1.036.

10. Applying the formula in paragraph 7, the indexable amounts for the 1998-99 financial year are:

Commissioner of Taxation
3 June 1998

Not previously released in draft form

References

ATO references:
NO 97/6479-8

Related Rulings/Determinations:

SCD 98/3
SCD 98/4
SCD 98/5

Subject References:
average weekly ordinary time earnings
earnings base
financial year
indexable amount
indexation
indexation factor
minimum contribution base
superannuation contributions
surcharge
surcharge threshold
threshold

Legislative References:
SCTAC 9(4)
SCTAC 9(5)
SCTIA 5
SCTIA 6(1)
SCTIA 6(2)
SCTIA 7(1)
SGAA 20
SGAA 21