ATO to Provide Excess Contributions Relief

It seems that the ATO will soon announce a minor concession in relation to excess contributions.  The concession will apply where the taxpayer has inadvertently triggered the “bring forward” of non-concessional contributions.  However, it seems that the concession will only be given where the triggering is truly inadvertent (and not due to inattention, or incorrect professional advice) and involves a small dollar value.  

It is suggested that the triggering could arise in a situation where the taxable income of the taxpayer has been overestimated or where deemed contributions are involved.

If this concession is granted, then it is to be welcomed, particularly if the concession applies from 1 July 2007.  Whether this concession is merely a transitional measure or a permanent measure is not known.  Also, it is not known whether this measure will be an administrative concession or supported by legislative changes.

A formal announcement is yet to be made in respect of this concession.  Presumably if and when the concession is announced, the details of how the excess contributions tax assessments are to be reversed will also be provided.