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Transfer foreign

Amounts transferred from a foreign super fund may be subject to tax.

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 ATO Website: Conditions that must be met.

The amount that makes up the foreign transfer amount can be identified into 3 different classifications:

  • Initial balance
  • Applicable fund earnings
  • non-vested amounts

 

From the Main Toolbar, go to Accounting.

Select Transaction list

  1. From the Transaction List screen, select New Transaction. From the drop down list, select Bank Statement.

  2. Input the Date of the transaction and a Reference number. You can include a description of the transaction in the Description box.

  3. 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.  

  4. Input the contribution amount received.  Simple Fund 360 will post a corresponding entry to the bank account field on the screen.

  5. The Contribution Details section will automatically appear in the more details panel of the 24200 account.Screen_Shot_2023-02-01_at_4.25.27_pm.png
    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*

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.

An individual who transfers a foreign balance into an Australian super fund can choose how the applicable fund earnings portion gets taxed. They can make an election to either:

  • Elect some or all the applicable fund earnings to the fund’s assessable income to be paid by the fund at the fund 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. 

 

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