The big issues facing Large Funds – 2017 National Superannuation Conference

Prashanthen Ranjit Kumar, Dave Millar and Michael Pascoe

The biggest changes to the taxation of superannuation in a decade came into effect at the beginning of July.

The Treasury Laws Amendment (Fair and Sustainable Superannuation) Act 2016 passed in late 2016. Subsequent regulations have also now been introduced and the ATO has finalised various compliance and law companion guidelines on the tax and superannuation reforms.

August's National Superannuation Conference will arrive at an opportune time as advisers to small and large funds come to terms with the new superannuation landscape.

In this post, we highlight some of the issues facing large funds that will be covered at the conference, including:

  • the CGT and member taxes issues associated with the 2016 Budget measures
  • issues with investments (both domestic and international)
  • considerations for the design of the in-house tax function and tax operating model for these funds.

The 2016 Budget measures created a number of various operational impacts for funds – in particular, the optional CGT rules upon transition and consequences for unit pricing. These transitional rules are designed to ensure that only capital growth after the introduction of the transfer balance cap (ie after 1 July 2017) is taxed, while the measures also impact unit pricing, requiring careful consideration by advisers. 

In their session, EY’s Brad Ivens ATI and David Millar will look at the practical steps advisers need to take when dealing with these issues.

Following the recent ATO Tax Alert in relation to the treatment of stapled entities, significant tax issues have been created that affect the due diligence of domestic investments by large superannuation funds. Further, the new rules for early stage venture and capital limited partnerships are causing headaches for advisers.

Damian Ryan CTA (KPMG) and Prashanthen Ranjit Kumar (QSuper) will cover the current tax issues facing advisers dealing with these investments.

International investments are also under scrutiny, with significant issues affecting the due diligence of such investments by large funds. 

In their session, PwC’s Todd Chesla, Jeff Miller and Makoto Takahashi will look at issues such as US tax treatment, the Foreign Investment in Real Property Tax Act (FIRPTA) and the Protecting Americans from Tax Hikes (PATH) Act. They will also provide an update on US tax reform and how it impacts US inbound investment.

Meghan Speers (Deloitte) and Daryn Loo (Cbus) will examine the in-house tax function and operating model. Reviewing the considerations for the design of an in-house tax function and the tax operating model for large superannuation funds, Meghan and Daryn will cover the tax touch points within your fund and how to identify efficiency gains. They’ll also look at tax risk monitoring and inputs into the fund’s tax risk framework, as well as considerations that can help funds shape their tax function to be future-ready.

Delegates will hear direct from the ATO on its program for reviews of large funds, and from the Minister for Revenue and Financial Services, the Hon Kelly O'Dwyer MP, as well as from economists and superannuation experts on the key broad policy settings affecting the entire superannuation industry, and their implications for associated tax settings and new product development.

Key industry representatives will also detail their experiences and observations on the implementation of the 2017 super tax reforms. And, in the conference’s opening address, Michael Pascoe, one of Australia’s most experienced and well-known finance and economics commentators, will provide some context for the shape-shifting nature of the government’s fiscal policy. 

The 2017 National Superannuation Conference will take place on 24-25 August in Sydney.

You can find out more about these sessions and more on our website. You can also discover more about the Conference’s dedicated SMSF sessions on our blog.


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