Superannuation Contributions Tax: Reportable fringe benefits total and the calculation of adjusted taxable income

Is a reportable fringe benefits total included in the calculation of the member's adjusted taxable income (ATI) for the purposes of the superannuation contributions surcharge and the termination payments surcharge for the financial year ended 30 June 2000?

Yes. A reportable fringe benefits total is included in the calculation of the member's ATI for superannuation contributions surcharge purposes in accordance with section 43 of the Superannuation Contributions Tax (Assessment and Collection) Act 1997 (SCTA), and for termination payments surcharge purposes in accordance with section 31 of the Termination Payments Tax (Assessment and Collection) Act 1997 (TPTA).

The member's taxable income for the financial year included a reportable fringe benefits total.

The Commissioner calculated the member's ATI to include the reportable fringe benefits total in the relevant financial year.

The Commissioner issued a superannuation contributions surcharge assessment and a termination payments surcharge assessment.

Section 43 of the SCTA defines a member's ATI for a financial year. ATI generally includes the member's taxable income for the financial year less any amounts that were non-employer eligible termination payments or lump sum payments for unused annual leave and long service leave paid on termination of employment because of a bona fide redundancy, early retirement or invalidity, plus the total member surchargeable contributions. If the member also has a reportable fringe benefits total for the relevant financial year, that amount will also be included in the calculation of the member's ATI.

The definition of ATI in section 43 of the SCTA specifically includes a member's reportable fringe benefits total for the financial year ended 30 June 2000 and future income years. Accordingly, the member's reportable fringe benefits total is included in the member's ATI calculation for the purposes of the superannuation contributions surcharge and the termination payments surcharge.

It should be noted that the meaning of ATI in the TPTA has the same meaning as ATI in the SCTA.

Note: Since the above decision was made, amendments to the Superannuation Contributions Tax (Assessment and Collection Act) 1997 have resulted in the definition of 'adjusted taxable income' (ATI) no longer being contained within section 43. The calculation of ATI is now determined with reference to section 7A or 7B of that Act (depending on the circumstances of each particular case).

These amendments, effective from 5 June 1997, do not affect the above decision.