Overview
Depending on the rules of the foreign super fund, amounts can be transferred to either:
- a complying Australian super fund (including an SMSF)
- the individual
The individual or the super fund may have to pay income tax on some or all of the amount.
By choosing to transfer the amount to a complying Australian super fund, the amount will generally count towards either or both of the member's contributions caps and may be subject to excess contributions tax.
For more information on whether your superfund is able to receive a transfer from a foreign fund, see the ATO article on Transfers from a foreign super fund to an Australian super fund.
The amount that makes up the foreign transfer amount can be identified into 3 different classifications:
- Initial balance
- Applicable fund earnings
- non-vested amounts
Record as a Member Contribution (Counts towards a Member's Contribution Cap)
| From the Main Toolbar, go to Accounting. | |
| Select Transaction list |
- From the Transaction List screen, select New Transaction. From the drop down list, select Bank Statement.
- Input the Date of the transaction and a Reference number. You can include a description of the transaction in the Description box.
- Under the Account heading, select the bank account from the Select an Account box. Click on the next Select an account box. Begin typing and select account 24200/MEMBERCODE.
- Input the contribution amount received. Simple Fund 360 will post a corresponding entry to the bank account field on the screen.
-
The Contribution Details section will automatically appear in the more details panel of the 24200 account.
Foreign Super Fund Amount Type of foreign transfer Assessable Non-Vested Amounts + Applicable Fund Earnings Amounts* Non-Assessable Initial Balance Amount + Applicable Fund Earnings Amounts*
Transfer with Election (Does not count towards a Member's Contribution Cap)
An individual who transfers a foreign super balance can choose to have the applicable fund earnings taxed within the Australian super fund instead of being taxed personally.
Through the ATO article, Completing your choice to have your Australian fund pay tax on a foreign super transfer
You can download ATO Election Form (NAT 11724), this form allows you to elect that all or part of the assessable amount is taxed in the fund at 15%, instead of your marginal tax rate.
When this election is made, the applicable fund earnings are treated as fund income and do not count towards the member’s contribution caps.
How to Record a Transfer with Election within Simple Fund 360
| From the Main Toolbar, go to Accounting. | |
| Select Transaction list |
- From the Transaction List screen, select New Transaction. From the drop down list, select Bank Statement.
- Input the Date of the transaction and a Reference number. You can include a description of the transaction in the Description box.
- Under the Account heading, select the bank account from the Select an Account box. Click on the next Select an account box. Begin typing and select account 28500/MEMBERCODE.
- In the More Details record the assessable portion under Element Untaxed, it will be taxed by 15%.
Applicable Fund Earnings
Income tax may need to be paid on the applicable fund earnings component of a foreign fund transfer.
Applicable fund earnings are the earnings made by the foreign fund since the member became an Australian resident.
- Elect to include some or all applicable fund earnings in the fund's assessable income, to be taxed at the fund's tax rate; or
- Elect the applicable fund earnings amount to be taxed at their own individual tax rate and be paid individually.
To make an election, see: Choice to have your Australian fund pay tax on a foreign super transfer.
Based on the election made, this amount can be recorded into Simple Fund 360 via the Assessable (taxed in the fund) field or Non-Assessable (not taxed in the fund) field.