Mid Year outlook outlines an increase to the SMSF Supervisory levy

The Mid-Year Economic & Fiscal Outlook (MYEFO) released today has seen the Government announce a further increase to the SMSF Supervisory levy to $259 for the 2013-14 financial year.  Having seen progressive increases in the supervisory levy since the introduction of the Simpler Super reforms from 1 July 2007, this jump represents the largest increase since that time. In more recent times these increases have formed part of the cost of Government reviews in superannuation, but the Government report released is suggesting that the current levy is not providing full cost recovery on the regulation of the growing SMSF sector.

In addition to seeing an increase in the levy from 1 July 2013, the Government has also announced changes to the timeliness of collection of the SMSF Supervisory levy.  Currently, the levy is collect in arrears through the SMSF Annual Return.  The Government, to help with the ‘cash-flow problems’ will align the collection of the levy with APRA regulated funds which pay in the year of operation.  This change in timing of collection will be phased in over 2 years meaning an additional $259 in levies will be collected from existing SMSFs during the 2013-14 and 2014-15 years.  This represents an additional $319 million in revenue savings based on forward estimates period of 2013-14 to 2015-16.  A nice little earner from self-funded retirees!!

Importantly, it would appear that the SMSF Annual Return will still act as the collection vehicle for the supervisory levy.

I have included below a diagram of the change to the SMSF Supervisory levy over the past 10 years.

What are your thoughts about the increase of the SMSF supervisory levy?

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  1. […] Image courtesy of Aaron Dunn from The SMSF Academy. […]

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