Draft legislation for other super measures introduced to Parliament

In addition to the ECPI choice of calculation measure and introducing the ‘work test’ for personal deductible superannuation contributions, Treasury Laws Amendment (Enhancing Superannuation Outcomes for Australians and Helping Australian Businesses Invest) Bill 2021, introduced to the lower house on October 27, 2021, included a number of other superannuation related matters.

ECPI redundant certificate Bill introduced to Parliament, but what about choice?

Treasury Laws Amendment (2021 Measures No.6) Bill 2021 was introduced into the lower house on 11 August 2021. Schedule 3 to the Bill amends the 1997 Tax Act to remove the requirement for SMSFs and Small APRA Funds to obtain an actuarial certificate when calculating exempt current pension income (ECPI), where all members of the fund are fully in retirement phase for all of the income year.

ECPI draft legislation – a closer look

With the release of draft legislation by Treasury on 21 May 2021 for the previous Budget proposal to provide choice to superannuation trustees when determining the fund’s claim for exempt current pension income (ECPI) and to remove a redundant requirement to obtain an actuarial certificate when claiming ECPI for certain funds, it’s time to take a closer look at the implications of the proposed measures, both from a technical and practical application perspective.

Majority of SMSF practitioners against proposed ECPI changes

Changes to how exempt current pension income (ECPI) is determined announced in the 2019-20 Federal Budget are due to come into force from 1 July 2021. While draft legislation is yet to be released, the proposals suggest SMSF trustees will be given a choice over whether to use the proportionate method or segregated method when claiming ECPI for funds that are solely in retirement phase for a period in an income year.