Ref: AMK:lg
24 February 2023
Retirement, Advice and Investment Division Treasury Langton Cres PARKES ACT 2600 By Email: superannuation@treasury.gov.au Dear Sir/Madam NON-ARM'S LENGTH EXPENSE RULES FOR SUPERANNUATION FUNDS 1.
Thank you for the opportunity to provide comments to the Treasury in relation to the consultation paper titled Non-arm’s length expense rules for superannuation funds (“Consultation Paper”).
2.
Pitcher Partners specialises in advising taxpayers in what is commonly referred to as the middle market. Accordingly, we service many clients that may be impacted by the non-arm’s length expense (“NALE”) rules.
3.
We welcome Treasury exploring potential reforms to the NALE rules following the Australian Taxation Office’s (“ATO”) interpretation of the rules contained in Law Companion Ruling (LCR) 2021/2 which, if correct, would result in disproportionate and unfair outcomes for breaches, particularly those relating to non-material amounts of general expenditure.
4.
We highlight that we do not support the recommended approach to dealing with the issues associated with the NALE provisions. We have outlined our concerns and alternatives in this submission.
Recommendations 5.
The following sections outline our main recommendations with respect to the proposed changes to the NALE rules. In particular: 5.1.
Leo Gouzenfiter
We recommend treating complying large APRA-regulated superannuation funds the same as other complying superannuation funds, as we do not agree with the distinction made which currently could be seen as being discriminatory.