Tax treatment of the benefits under new super scheme causes confusion
Fri Apr 27 2007
The Age --- Page: B2 : 27 April 2007 Original article by Max Newnham
ABIX Summary
There is confusion about the tax treatment of the two types of benefits under Australia's new superannuation laws. Undeducted contributions to tax-exempt pensions in self-managed super funds require that future withdrawals be in proportion, being comprised of taxable and exempt components. Prior to 1 July 2007, lump sum withdrawals can come from specified components of a super fund, meaning that lump sums can be made of undeducted contributions, although for people under the age of 60 withdrawals after the deadline will have to be done proportionally. People over the age of 60 who are still working will be able to draw tax-free funds from their super and recontribute the money as a tax-deductible contribution.
