However, with clients starting to think about preparing their tax returns, it is important that critical administrative requirements are not inadvertently overlooked.
 

In the case of a valid NOI a client must advise the super fund of the amount of personal contributions made during the income year that they wish to claim as a personal tax deduction, and receive an acknowledgement from the fund, in order for the fund to convert those amounts from non-concessional to concessional contributions and tax them accordingly.
 

Eligible contributing members must submit the appropriate ‘notice of intent’ (NOI) form (also known as a section 290-170 form) to the super fund before the earlier of the following two dates:
 

But in addition to these deadlines are a set of preconditions that invalidate an NOI if, in broad terms, the fund no longer holds the contribution or if part or all of the capital has been converted into an income stream. This rule could impact clients when funding a super life policy via rollover.

John can submit a new NOI but for a reduced amount (in practice the revised amount will vary depending on the client’s balance and tax-free/taxable component mix of the source fund and how much is rolled over). Not only was this come as a shock to both the client and their accountant, but the 15% rebate is also partially offset by the additional tax liability. These issues could have been avoided by submitting the NOI to John’s primary fund at the time of the contribution or before the 1 August 2023 $10,000 rollover.

Consider clients that hold a risk-only super policy and premiums are being funded directly via personal contributions. If the cover were to be cancelled prior to the client submitting their NOI it will likely result in the NOI being invalid – as the client will typically no longer be a member of the fund once the policy is cancelled.
 

It is also important to note the NOI timeframe and process applies equally to personal super contributions made to a SMSF. That said, clients will need to lodge an NOI with the SMSF trustee – and the SMSF trustee must, in turn, acknowledge the receipt of the NOI before a deduction can be claimed.
 

If you would like further information about these technical considerations or any other advice strategies, please contact the TECE team at tece@aia.com.