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Grace Liang

Sep 07, 2022

Late personal injury contribution

in SMSF Technical Forum

I am currently auditing a 2019 & 2020 super fund - in September 2022.

The Superfund has a sole member who is 40 years old. The member received a large personal injury settlement in January 2019. The member decided to establish SMSF in February 2019 with the intention to make a personal injury contribution to it. The election form was given to the SMSF to have the contribution classified as a personal injury contribution a week after the superfund was established. However, there was a delay due to medical reasons that prevented the member from being able to establish a bank account for the SMSF, he couldn’t get to a branch due to his personal injury. The contribution was deposited in May 2019 when the bank account was established making it outside the 90 days period to contribute a personal injury settlement by less than 1 month.

Is there any discretion from the Commissioner or otherwise to treat the contribution as a qualifying medical personal injury contribution?

1 answer0 replies

Comments (1)

THE AUDITORS INSTITUTE

Sep 08, 2022

Hi Grace

Yes the ATO (the Commissioner) does have the discretion to allow a greater period than 90 days to allow the contribution to be made.

My view would be for the trustees to apply to the ATO for their discretion. The tax agent for the individual or the Fund should be able to apply on behalf of the trustee / member over the tax agent portal. If any members have had experience in applying to the ATO for such discretion please let the forum know.

I have not seen a SMSF receive a personal injury contribution and do not believe they are common.

Thanks

SMSF AAA