Bills Digest no. 91 2006–07
Bankruptcy Legislation Amendment (Superannuation
Contributions) Bill 2006
WARNING:
This Digest was prepared for debate. It reflects the legislation as
introduced and does not canvass subsequent amendments. This Digest
does not have any official legal status. Other sources should be
consulted to determine the subsequent official status of the
Bill.
CONTENTS
Passage History
Purpose
Background
Financial implications
Main Provisions
Concluding Comments
Endnotes
Contact Officer & Copyright Details
Passage History
Bankruptcy Legislation Amendment
(Superannuation Contributions) Bill 2006
Date introduced:
6 December 2006
House: Senate
Portfolio: Attorney-Generals
Commencement:
Different provisions of
the Bill commence on a variety of dates, including
retrospectively in some cases. The most significant amendments
(Schedule 1, Part 1) apply to superannuation contributions made on
or after 28 July 2006(1)
This Bill
amends the Bankruptcy Act 1966 to:
- provide for the recovery of superannuation contributions made
with the intention to defeat creditors
- provide for certain rural support grants to be exempt from the
property available to pay the bankrupt s creditors, and
- make minor technical amendments to clarify or improve the
operation of Commonwealth bankruptcy
legislation.(2)
This Bill also amends the following Acts in
pursuit of the above objectives:
- the Payment Systems and Netting Act 1998, and
- the Proceeds of Crime Act 2002.
The background for this Bill was the High
Court s decision in Cook v Benson (June
2003).(3) The case revolved around the correct
application of section 120 of the Bankruptcy
Act 1966 (the Act). This particular section, in part,
reads:
S.120 Undervalued transactions
Transfers that are void against trustee
- A transfer of
property by a person who later becomes a
bankrupt (the transferor) to another person (the
transferee) is void against
the trustee in the transferor's
bankruptcy if:
- the transfer took place in the period beginning 5 years before
the commencement of the bankruptcy and ending on
the date of the bankruptcy; and
- the transferee gave no consideration for the transfer or gave
consideration of less
value than the market
value of the
property.
The section goes on to list a number of
exceptions to this particular provision.
In this section, if a person who later becomes
a bankrupt undertakes a transaction within certain time periods,
where they do not receive adequate consideration in return, the
assets transferred as part of transaction are available to their
trustee in bankruptcy. This section was introduced into the Act to
deal with situations where a person facing bankruptcy transferred
their assets to a third party (a relative or associate of the
person who later goes bankrupt) in an attempt to defeat their
creditors and did not receive adequate consideration in return.
The majority judgement in Cook v
Benson held that Mr Benson s transfer of his pre bankruptcy
superannuation benefits from one superannuation fund to three other
superannuation funds were bona fide transactions for which he
received adequate consideration in return. Thus the provisions of
section 120 of the Act did not apply to these
particular transactions. Consequently, the trustee in bankruptcy
was not able to access these particular contributions to the three
superannuation funds.
The decision was widely interpreted as denying
a trustee in bankruptcy access to contributions made to
superannuation funds prior to bankruptcy.(4)
On 16 December 2003 the Attorney-General and
the Minister for Revenue and Assistant Treasurer issued a joint
press release announcing amendments to the Act to ensure that
certain superannuation contributions made prior to bankruptcy could
be recovered by bankruptcy trustees and so remedy the problem
created by Cook v Benson.(5)
On 6 September 2005 the government released a
discussion paper on the treatment of superannuation contributions
made prior to bankruptcy. Initially, it was proposed that only
excessive superannuation contributions would be able to be
recovered by a trustee in bankruptcy. However, following a period
of extensive consultations with both the superannuation industry
and bankruptcy practitioners the government decided to revise its
position.(6)
The revised position proposed that the Act be
amended so that contributions made to superannuation funds in an
attempt to defeat potential creditors will be available to the
trustee in bankruptcy for distribution. The Bill implements this
proposal.
The amendments to the Act in this Bill were
announced in a joint news release from the Attorney General, the
Hon. Phillip Ruddock MP and the Minister for Revenue &
Assistant Treasurer, the Hon. Peter Dutton MP on 27 July
2006.(7)
There has been comparatively little press
comment on the proposals in the Bill. One commentator has noted
that the proposed changes strike a fair balance between the claims
of creditors and the legitimate rights of debtors to provide for
their retirement. This view was supported in one other press
article.(8)
The following organisations have expressed
their general support for the Bill:
- Australian and New Zealand Banking Group
(ANZ)(9)
- the Association of Superannuation Funds of Australia
(ASFA)(10)
- the Investment and Financial Services Association
(ISFA)(11)
- the Business Law Section of the Law Council of
Australia(12)
- the Australian Finance Conference,(13)
- the Australian Society of Certificated Practicing Accountants,
and(14)
- the Institute of Chartered Accountants.(15)
The specific technical comments that these, and
other organisations, have on the Bill will be referred to in the
following Main Provisions section.
The comments made by the industry relate to the
workability of the proposed amendments and their interaction with
existing superannuation and family law. None of the organisation
have opposed the Bill or recommended that it should be rejected as
a whole.(16)
The legislation clearly deals with the
difficulties highlighted by the High Court s decision in Cook
v Benson. If the Bill is enacted it will be far more
difficult for a person facing bankruptcy to shelter their assets
inside the superannuation environment.
Further, the Bill s provisions make it clear
that only contributions made to a superannuation fund(s) in an
attempt to defeat creditors, are subject to these provisions. The
bankrupt s legitimately accumulated superannuation benefits will
not be available to the trustee in bankruptcy.
A note of caution has been sounded about the
proposed amendments. While supporting the intent of the Bill,
prominent lawyer, Mr Peter Bobin, questions how they will interact
with the forthcoming changes to the superannuation system that
allow significant contributions to a superannuation fund. He notes
that up to $1m can be contributed to a superannuation fund before 1
July 2007 and up to $450 000 over a three year period after
that.(17) Mr Bobbin is concerned that such contributions
would be seen as out of character with the bankrupt s normal
pattern of superannuation contributions and therefore be available
to their trustee in bankruptcy.(18)
Several commentators have noted that existing
paragraph 116(5)(b) of the Act protects a
bankrupts superannuation benefits, up to the pension reasonable
benefit limit (currently $1 356 291). They note that the Tax
Amendments (Simplified Superannuation) Bill 2006 currently before
Parliament abolishes these reasonable benefit limits. They then
question whether the same level of protection for a bankrupt s
superannuation benefits will exist after the passage of this Bill
and the Simplified Superannuation Bill.(19)
Items 1, 2
and 3 of Schedule 3 of the
Superannuation Legislation Amendment (Simplification) Bill 2006
(currently before Parliament) repeal paragraph
116(5)(b) and related paragraphs of the Act. This
particular amendment will solve this perceived problem.
To date, the Australian Labor Party has not
made a formal statement on this particular Bill. However, it has in
the past expressed support for measures to assist trustees in
bankruptcy in recovering a bankrupt s assets.(20)
A significant potential consequence may be the
entrenchment of the view that those facing bankruptcy will be able
to protect assets that may otherwise be available to their trustee
in bankruptcy, by transferring their assets into a superannuation
fund.
There are no financial implications for the
Commonwealth budget as a result of either passing, or failing to
pass, this Bill.
Item 6 inserts a new
Subdivision B at the end of Division
3 of Part VI of the Act. This new
Subdivision deals with superannuation contributions and is the main
provision of this Bill. There are two types of contributions dealt
with in this new Subdivision:
- contribution(s) made by a person who later becomes a bankrupt,
and
- contribution(s) made by a third party for the benefit of a
person who later becomes a bankrupt.
New section 128B deals with the
first type of contribution. Subsection 128B(1)
states that a contribution to a superannuation fund by a person who
later becomes bankrupt is accessible if:
- the contribution would probably have become part of the person
s estate or would have been available to their creditors, and
- the main purpose in making the contribution was to prevent
these funds being divided amongst their creditors or to hinder or
delay the process of making this property available to these
creditors (i.e. the contribution was designed to defeat creditors),
and
- the contribution took place on or after 28 July 2006.
Subsections 128B(2),
(3) and (4) provide guiding
principles for determining whether the person s main purpose was to
defeat creditors.
Subsection 128B(2) provides that
a court can infer that the bankrupt s main purpose in making the
contribution was to defeat creditors if the bankrupt was, or was
about to become insolvent when the contribution was made.
Comment
Becoming insolvent is not the same as entering
bankruptcy. Often, a person will be insolvent well before formally
entering bankruptcy. Thus a contribution to a superannuation fund
may be available to a trustee in bankruptcy if it is made at some
point before the person formally enters bankruptcy.
Subsection 128B(3) states that
one of the matters to be taken into account in determining whether
a contribution to a superannuation fund was made to defeat
creditors is whether the contribution was out of character with a
previous pattern of superannuation contributions.
Subsection 128B(4) provides that
the ways in which a person s main purpose in making superannuation
contributions was to defeat their creditors are not limited to the
matters addressed in subsections 128B(2) and
(3).
While the Explanatory Memorandum does not
further comment on what kind of superannuation contributions may be
out of character, the Second Reading Speech notes one example where
this may occur:
If the bankrupt had no history of making
substantial superannuation contributions but made such
contributions shortly before becoming bankrupt, this may indicate
that the contributions were made to defeat
creditors.(21)
As subsection 128B(4) does
not limit the matters taken into account in determining whether a
superannuation contribution was made with the intention to defeat a
person s creditors the reach of this section is particularly
broad.
Industry comment s.
128B
As a general point, Superannuation Australia
is concerned that the assessment of whether a particular
contribution was made with the express intent to defeat creditors
will be very difficult where:
- a business, that later goes bankrupt, is in a very poor
situation but from which it may reasonably be argued it had
prospects of recovery, or
- where the person, who later becomes bankrupt, is advised by
third parties to make the contributions in the above situation as a
normal part of preparation for retirement.(22)
This is a minor comment and the resolution of
this particular matter will most likely be decided on a case by
case basis. Generally, industry strongly supported the intent
behind this particular section.
New section 128C of the Act
allows contributions that are made by third parties to a
superannuation fund to be recoverable by the trustee in bankruptcy
where:
- contributions are made for the benefit of a person who later
becomes bankrupt, and
- the person who later goes bankrupt is a party to a scheme under
which these contributions were made, and
- the contributions would probably have become part of the
bankrupt s estate to which creditors would have had access,
and
- the main purpose of these arrangements was to defeat their
creditors, or to delay the payment of these monies to the
creditors, and
- these contributions occurred on or after 28 July 2006.
The Second Reading Speech gives an example of
such circumstances:
In addition, they will apply to contributions made
by a third party for the bankrupt s benefit where the bankrupt was
complicit in an arrangement with that third party to defeat
creditors. This may occur, for example, where the bankrupt had
entered into a salary sacrifice arrangement with his or her
employer to build up superannuation assets in the lead up to
bankruptcy instead of other assets which would have been available
to pay creditors .(23)
Under subsection 128C(2)
there are limits on the contributions that may be recovered by the
trustee in bankruptcy. This limit is where the person dies and the
spouse, and/or the bankrupt s children, are the beneficiary of the
superannuation payment.(24)
Comment
Under general superannuation and employment
law there are other circumstances where the contributions to a
superannuation fund are made by employers or third parties for
purposes other than defeating their creditors. An employer may make
such contributions in satisfaction of meeting the provisions of a
long standing employment contract for the person or to meet the
requirements of the Superannuation Guarantee regime.(25)
Thus, contributions made under normal employment arrangements are
unlikely to be subject to this particular section.
Subsections 128C(3) and
(4) also provide guiding principles for
determining whether the person s main purpose was to defeat
creditors in these circumstances. Subsection
128C(6) provides that the above subsections do not limit
the ways in which an intention to defeat creditors by contributions
made on behalf of a bankrupt can be proved.
New section 128D of the Act
provides that action under sections 128B or
128C discussed above can commence at any time
after the commencement of Part 2 of
Schedule 1 of this Bill. This is a very broad
power. A trustee in bankruptcy can commence action to recover such
contributions at any time during a person s period of
bankruptcy.
Items 7 and
8 amend sections 149A &
149D of the Act. These amendments extend the
grounds for a trustee to object to the discharge of a bankrupt to
include the occurrence of contributions to superannuation funds
recoverable under new sections 128B and
128C.
Item 16 amends
subsection 116(1) of the Act to ensure that monies
paid from a bankrupt s superannuation accounts under new
sections 128B and 128C are
available to the bankrupt s creditors.
Items 19 and
20 insert additional paragraphs into new
sections 128B and 128C discussed
above. The effect of these additional paragraphs is that any tax,
fee or charge payable on amounts recovered under the provisions of
these sections are refunded, by the trustee in bankruptcy, to the
superannuation trustee who made the payment.
Comment
The amounts to be recovered under these
sections are the gross amounts contributed to the superannuation
funds. If the contribution were by way of salary sacrifice a 15 per
cent tax would have been applied to that contribution and may well
have been paid long before recovery action had started. Likewise,
if the contribution was an excessive contribution that is, one in
excess of the relevant allowable limit a tax of 46.5 per cent may
have been applied and paid. The trustee of the relevant
superannuation fund is liable for these amounts. Further, amounts
may have been deducted from these contributions by way of fees and
charges. The trustee in bankruptcy must pay the superannuation fund
trustee any of these amounts that have been taken out of the
contributions recovered under new sections 128B
and 128C, in compliance with a notice under
section 139ZQ (see below).
Industry Comment Items 19
and 20
There has been substantial industry comment in
relation to Items 19 and 20,
specifically:
- the refund of taxes, fees or charges applies to action taken in
response to notices given under section 139ZQ of
the Act. However, similar notices can be given under new
section 139ZU of the Act (see below).
Items 19 and 20 should also allow
for the trustee in bankruptcy to refund taxes, fees or charges
deducted from contributions recovered in compliance with a new
section 139ZU notice.(26)
- several industry organisations have noted that only the
superannuation trustee will possess the necessary information to
accurately calculate the amount deducted. They submit that it would
be far simpler if these provisions required the superannuation
trustee to pay the net amount back to the trustee in
bankruptcy,(27) and
- one industry organisation has noted that it is possible that,
under the proposed wording of these provisions, a superannuation
fund trust could claim amounts for fees and charges already
deducted from the amounts repaid.(28)
In its response to questions on notice raised
in the public hearings of Senate Standing Committee on Legal and
Constitutional Affairs on this Bill, the Insolvency and Trustee
Service of Australia noted that a net amount, leaving aside fees
and charges already deducted by the superannuation trustee, will be
accepted by the trustee in bankruptcy or the Official Receiver as
an amount complying with a notice under section
139ZQ of the Act.(29)
Comment
The provisions are designed to allow the
trustee in bankruptcy to receive the gross amount contributed to a
superannuation fund in an effort to defeat a person s creditors. It
is this gross amount that is the property that, under the proposed
provisions, is properly available to the creditors. It is only fair
that the creditors have access to these gross amounts. However, the
requirement that the trustee in bankruptcy repay the superannuation
fund trustee the amounts otherwise deducted must come from some
source, most likely that source will be the amounts recovered from
the superannuation funds, or other amounts recovered in respect of
the particular bankruptcy being dealt with. Thus, it is likely that
the creditors will have far less than the gross amounts recovered
under these provisions for distribution, irrespective of whether
the superannuation trustees return the gross or net amounts of
superannuation contributions recoverable under section
128B and 128C of the Act.
A further difficulty with the proposal for the
superannuation trustees to only return the net amount of benefits
arises where a Self Managed Superannuation Fund (SMSF) is involved.
One of the requirements for an SMSF is that all members (limited to
4) must be trustees of the fund. Thus, a SMSF trustee will also be
the bankrupt who made questionable contributions to that fund.
If a SMSF trustee is only required to return
the net amount of superannuation contributions to which a notice
under sections 139ZQ or 139ZU
applies they are in a position to determine the amount of fees,
taxes or charges, to be deducted from this amount. It is not beyond
the bounds of possibility that such trustees may decide that an
inordinate amount of such fees, taxes or charges be deducted from
any amount returned to a trustee in bankruptcy. The requirement to
return the gross amount of the contributions to which
sections 128B or 128C apply
avoids this problem.(30)
Item 21 inserts new
section 128E into the Act. This section allows the
Official Receiver to issue an order to prevent a bankrupt from
dealing with their superannuation fund where the Official Receiver
has reasonable grounds to believe that contributions have been made
to which new sections 128B or
128C apply. The Official Receiver may give such an
order to a superannuation fund trustee if they are also the
bankrupt s trustee, or on the application of the bankrupt s
registered trustee.
There are exceptions to these orders. Of
particular interest is the exception in paragraph
128E(2)(f) which allows a benefit frozen under the
provisions of this section to be split pursuant to an order under
the provisions of the Family Law Act 1975.
Industry comment section
128E
One industry participant is concerned that the
ability of a superannuation trustee to give effect to a family law
payment split, while an order under section 128E
is in force, would be used as a way to hide superannuation assets
from a trustee in bankruptcy.(31) The Investment and
Financial Services Association argues that the restrictions on a
bankrupt s ability to deal with the superannuation benefit should
also be attached to any amounts that are transferred to another
fund as a family law payment split.(32)
The Investment and Trustee Service Australia
have advised that a split made under the provisions of the
Family Law Act 1975, while an order under new
section 128E was in force, would be ineffective,
as long as the bankruptcy trustee proves the intent of the split
was to defeat creditors.(33)
New section 128F of the Act
deals with the revocation of the superannuation account freezing
order issued under section 128E discussed above.
An order under this latter section is revoked when:
- the superannuation fund complies with a section
139ZQ notice
- the superannuation fund complies with a new section
139ZU notice
- if neither of these orders has been issued, 180 days after a
freezing order was issued under section 128E
- if an application for a notice under sections
139ZQ or 139ZU has revoked or set aside
by the court, or
- at the initiative of the Official Receiver where they are also
the trustee in bankruptcy, or
- by the Official Receiver at the request of the bankrupt s
registered trustee or by the bankrupt themselves.
New section 128H specifies
that the Official Receiver s consent is required for the cashing,
debiting, rollover, transfer of forfeiture of a superannuation
benefit at the request of the bankrupt, while a superannuation
account freezing notice is in force. The Official Receiver must
consult with the bankrupt s trustee in all such cases.
Comment section
128H
It may be the case that those going through
bankruptcy will be experiencing severe financial hardship. In such
circumstances current Superannuation Regulations allow the
withdrawal of up to $10 000 to alleviate this hardship. Where such
withdrawals occur it is not clear whether these withdrawn benefits
would be available to the trustee in bankruptcy for distribution to
creditors.
Item 23 inserts a definition
of the term costs into section 128N of the Act.
These costs in relation to a superannuation fund include
transaction costs, government charges, taxes and duties and
management charges. It does not include withdrawals to pay
insurance premiums for policies connected with the account when a
freezing notice is in force.
Industry comment - section
128N
Industry groups have recommended that the
definition of costs to be inserted into section
128N of the Act include costs associated with insurance
premiums.(34)
The Insolvency and Trustee Service Australia
has noted that insurance premiums may be in many cases a
discretionary item of expenditure, even when such premiums are paid
through a superannuation fund. Nevertheless, it has undertaken to
further consider this issue in the context of framing regulations
relating to this section.(35)
Comment
Often, the most cost effective way for a
person to purchase and maintain life insurance cover is through
their superannuation fund.
Item 34 inserts new
section 139ZU into the Act. This section allows a
notice to be issued to trustees of a superannuation fund where:
- amounts recoverable under sections 128B or
128C have been contributed to two or more
superannuation funds, and
- one of those superannuation funds does not contain the total
amount to be recovered, or
- the member has transferred amounts to which sections
128B or 128C apply to a third
superannuation fund.
A notice under existing section
139ZQ can only be issued to one superannuation fund. A
notice under this new section allows a notice for payment to be
issued to other superannuation funds for the repayment of amounts
to which sections 128B or 128C
apply.
Item 5 repeals
paragraphs 116(2)(k) to
(md) of the Act and substitutes new provisions.
The effect of these provisions is that amounts paid under
Commonwealth, State or Territory rural support schemes are not
property available to a bankrupt s trustee or property divisible by
the bankrupt s creditors.
Concluding comments
Though industry and other parties have made
substantial comment on this Bill, it would be a mistake to take
this comment as grounds for rejecting the legislation. Rather,
industry and other parties as a whole strongly support the Bill and
their comments are offered to improve the workability of the final
legislation.
Nothing in this Bill allows a trustee in
bankruptcy to access any more of a bankrupt s superannuation assets
than the contributions made for the purpose of defeating their
creditors.
-
Senator the Hon. Christopher Ellison, Minister for Justice and
Customs, Second reading speech: Bankruptcy Legislation Amendment
(Superannuation Contributions) Bill 2006 , Senate,
Debates, 6 December 2006, p. 1.
-
The Hon. Phillip Ruddock MP, Explanatory Memorandum to the
Bankruptcy Legislation Amendment (Superannuation Contributions)
Bill 2006, 6 December 2006, p. 1.
-
(2003) 214 CLR 370.
-
Insolvency and Trustee Service Australia (ITSA), Effect of
bankruptcy on superannuation contribution, Consultation Paper,
September 2005, p. 1.
-
The Hon. Phillip Ruddock MP, Attorney-General and Senator the
Hon. Helen Coonan, Government Moves to Close Super Loophole ,
Joint Media Release, c120/03, 16 December 2003.
-
The Hon. Phillip Ruddock MP, Attorney-General, the Hon. Mal
Brough MP, then Minister for Revenue and Assistant Treasurer,
Reforms Target Bankruptcy Super Contributions , News
Release, 162/2005, 6 September 2005 and ITSA, ibid.
-
The Hon. Phillip Ruddock MP, Attorney-General, the Hon. Peter
Dutton MP, Minister for Revenue and Assistant Treasurer, Government
Closes Superannuation Loophole in Bankruptcy New Release,
138/2006, 27 July 2006.
-
John Wasilive, New laws limit rorts by bankrupt , Australian
Financial Review, 16 August 2006, p. 33, and Elizabeth Colman,
Bankrupts face super scrutiny , The Australian, 28 July
2006, p. 21.
-
ANZ, Submission Senate Standing Committee on Legal and
Constitutional Affairs Inquiry into the Bankruptcy Legislation
Amendment (Superannuation Contributions) Bill 2006, 19 January
2007.
-
ASFA, Submission to the Senate Standing Committee on Legal and
Constitutional Affairs Inquiry into the Bankruptcy Legislation
Amendment (Superannuation Contributions) Bill 2006, 19 January
2007, p. 2.
-
ISFA, Submission Senate Standing Committee on Legal and
Constitutional Affairs Inquiry into the Bankruptcy Legislation
Amendment (Superannuation Contributions) Bill 2006, 22 January
2006.
-
Law Council of Australia, Submission Senate Standing Committee
on Legal and Constitutional Affairs Inquiry into the Bankruptcy
Legislation Amendment (Superannuation Contributions) Bill 2006, 19
January 2007.
-
Australian Finance Conference, Submission Senate Standing
Committee on Legal and Constitutional Affairs Inquiry into the
Bankruptcy Legislation Amendment (Superannuation Contributions)
Bill 2006, 19 January 2007.
-
CPA Australia, Submission Senate Standing Committee on Legal and
Constitutional Affairs Inquiry into the Bankruptcy Legislation
Amendment (Superannuation Contributions) Bill 2006, 19 January
2007.
-
The Institute of Charted Accountants in Australia, Submission
Senate Standing Committee on Legal and Constitutional Affairs
Inquiry into the Bankruptcy Legislation Amendment (Superannuation
Contributions) Bill 2006, 19 January 2007.
-
These other organisations are, the Taxation Institute of
Australia, AXA Life Insurance Australia and Superannuation
Australia (a fully owned subsidiary of Taxpayers Australia).
-
For additional details on these contributions see Leslie
Nielson, Taxation Amendment (Simplified Superannuation) Bill 2006 ,
Bills Digest, no. 65, Parliamentary Library, Canberra 2006
2007.
-
Michael Laurence, Your Money: nowhere to hide Bulletin with
Newsweek, 24 January 2007.
-
Law Council, op. cit., p. 3 and The Institute of Charted
Accountants in Australia, op. cit., p. 1.
-
Ms Nicola Roxan MP, Government Baulks on High Flyers Yet Again ,
Media Statement, 8 February 2005 and Government Avoidance
of Anti-avoidance Laws Beyond a Joke , Media Statement, 8
august 2005.
-
Senator the Hon. Christopher Ellison, op. cit., p. 2.
-
Superannuation Australia, Submission Senate Standing Committee
on Legal and Constitutional Affairs Inquiry into the Bankruptcy
Legislation Amendment (Superannuation Contributions) Bill 2006, 19
January 2007.
-
Senator the Hon. Christopher Ellison, op. cit., p. 2.
-
The Hon. Phillip Ruddock MP, Explanatory Memorandum to the
Bankruptcy Legislation Amendment (Superannuation Contributions)
Bill 2006, 6 December 2006, p. 6.
-
That is, avoiding the imposition of the Superannuation Guarantee
Charge unde the provisions for the Superannuation Guarantee
(Administration) Act 1992.
-
Taxation Institute of Australia, Submission to the Senate
Standing Committee on Legal and Constitutional Affairs Inquiry into
the Bankruptcy Legislation Amendment (Superannuation Contributions)
Bill 2006, 12 January 2006, p. 3.
-
ASFA op. cit., p.3, AXA, op. cit., p.3 and ISFA, op. cit., p.
5.
-
ASFA, op. cit., p. 3.
-
Treasury/ITSA, Response to Questions on Notice raised at the
public hearings of the Senate Standing Committee on Legal and
Constitutional Affairs , 23 January 2006, p. 3.
-
To retain these amounts under their control a SMSF trustee would
have to either re-credit the amounts not passed on to the trustee
in bankruptcy to their account, or make use of the forfeiture
provisions. This latter course is difficult because of the effect
of s.302 of the Act that states that such
forfeiture actions are void if they are carried out with the intent
to defeat creditors. The requirement to return the gross amount of
the contributions to which new sections 128B and
128C apply sidesteps these potential
complications.
-
ANZ, op. cit.
-
Treasury/IFSA, op. cit., p. 4.
-
Treasury/ITSA, ibid., p.1.
-
AXA, ibid., p. 2, ASFA, ibid., p. 4.
-
Treasury/ITSA, ibid., p. 2.
Leslie Nielson
13 February 2007
Bills Digest Service
Parliamentary Library
This paper has been prepared to support the work of the
Australian Parliament using information available at the time of
production. The views expressed do not reflect an official position
of the Parliamentary Library, nor do they constitute professional
legal opinion.
Staff are available to discuss the paper's
contents with Senators and Members and their staff but not with
members of the public.
ISSN 1328-8091
© Commonwealth of Australia 2007
Except to the extent of the uses permitted under the
Copyright Act 1968, no part of this publication may be
reproduced or transmitted in any form or by any means, including
information storage and retrieval systems, without the prior
written consent of the Parliamentary Library, other than by members
of the Australian Parliament in the course of their official
duties.
Published by the Parliamentary Library, 2007.
Back to top