ASFA welcomes CGT relief for merging superannuation funds
The Association of Superannuation Funds of Australia (ASFA) has welcomed new legislation which it said would ultimately protect member balances during super fund mergers.
ASFA chief executive officer Pauline Vamos said the capital gains tax (CGT) relief for super funds would allow super funds to merge without triggering an adverse tax event.
"Without the CGT relief, fund mergers could lead to members of merging funds suffering tax-related losses of up to two per cent of their super account," Vamos said. "Or [to] mergers delayed or abandoned altogether."
The legislation would apply retrospectively from 1 October 2011.
The initial CGT rollover relief was first introduced as a result of the global financial crisis, but it ended on 30 September 2011.
"We are very pleased to see that relief will cover the period from 1 October 2011 to 1 July 2017, as this will provide certainty for many funds planning future strategy," Vamos said.
"The collaborative advocacy efforts involving many super funds contributing details of their situations to Treasury, and to the Treasurer's adviser, has clearly illustrated the issue in a compelling way," she added.
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