Government Announcements
Tax relief for merging super funds: discussion paper
16.01.2009
The Minister for Superannuation and Corporate Law has released the Treasury discussion paper on the Government’s measure to provide an optional CGT roll-over for superannuation funds that merge with other complying funds.
Under the measure (which was announced by the Minister on 23 December 2008), optional CGT roll-over will be available for capital losses arising from CGT events happening under a complying superannuation fund’s merger (after 23 December 2008 and before 1 July 2010) with an APRA-regulated superannuation fund with at least five members.
The Minister said that, typically, the transfer of assets from one super fund to another, as part of a merger of the funds, triggers the realisation of capital gains or losses for the transferring fund. If the transferring super fund is in a net capital loss position, its winding up following these transfers will lead to these losses being extinguished. Such losses, which reduce member balances, have acted as a barrier to fund mergers. The roll-over will preserve the value of these capital losses in the receiving super fund – allowing them to be offset against future capital gains.
For the text of the Minister’s media release announcing the measure, click here and for the Minister’s media release relating to the release of the consultation paper, click here.
