Payday Super – Legislation introduced for concessional cap transitional rule
New Payday Super legislation addresses concessional contributions cap issues for 2026/27, but salary sacrifice and early payments remain key concerns.
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By: Thomas Isbell, George Bendall
18 Nov 2021 2 min read
In accordance with the Gazette Notice registered on 16 November 2021, the ATO is set to acquire an additional three financial years of Medicare Exemption Statement (‘MES’) data from Services Australia.
The data to be acquired will encompass the 2021, 2022 and 2023 financial years and will include taxpayer details of:
The ATO has undertaken the ‘specified benefits and entitlements’ data-matching program for a number of years. The key feature of the program is that it allows the ATO to compare MES data against Medicare levy and Medicare levy surcharge claims in taxpayer income tax returns. This protocol is estimated to provide the ATO with records of 100,000 individuals each financial year.
Medicare allows Australian residents access to the public healthcare system and is partially funded by the 2% Medicare Levy which taxpayers are subject to on their taxable income. Additionally, taxpayers without adequate private health insurance coverage are required to pay the Medicare Levy Surcharge (up to 1.5% of their taxable income) where their income exceeds the threshold (currently $90,000 for singles and $180,000 for couples).
Some taxpayers are not entitled to Medicare benefits and accordingly can claim an exemption from the Medicare Levy & Medicare Levy Surcharge in their personal income tax return. The ATO’s data matching program enables identification of instances where exemptions have correctly or incorrectly been claimed. Where the program has highlighted that a taxpayer has incorrectly claimed an exemption, the ATO will seek further information from the taxpayer.
New Payday Super legislation addresses concessional contributions cap issues for 2026/27, but salary sacrifice and early payments remain key concerns.
The Government has introduced legislation for a minimum 30% tax on discretionary trusts from 1 July 2028. While some stakeholder feedback has been adopted, significant concerns remain around flexibility, complexity and the impact on private groups and SMEs.
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