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15/11/2010 Consolidation regime changes

Since its inception in 2002, the consolidation regime has allowed wholly-owned corporate groups to operate as a single entity for income tax purposes.

The 2010-11 Annual Budget, has resulted in Government initiatives that aim to improve how collections of the income tax from consolidated and multiple entry consolidated groups (MEC) are completed. Changes include;

–          from 11 May 2010, the government can recover unpaid (PAYG) liabilities

–          from 11 May 2010, the ‘liability for payment of tax’ rules apply to MEC groups

–          from the 2004-05 income year, an entity that pays its contribution amount under a tax sharing agreement can leave a consolidated group of MEC group clear from any further liability

–          from 1 July 2002, where there is a change in the provisional head company of a MEC group during an income year, any PAYG instalments paid by the former provisional head company on behalf of the group are attributed to the group.

The above changes were announced in the hope of resolving several long-standing operational issues and providing greater certainty and less compliance costs to businesses seeking to consolidate for tax purposes.

Posted on 15 November '10 by , under Business.

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What to consider when consolidating your super

The ATO reported that 45% of working Australians were not aware that they had multiple super accounts in 2016. Having multiple super accounts is particularly common for individuals who have had more than one job. If this is you, it is important to identify and manage your super accounts because having more than one can be costly as a result of account fees from multiple funds.To combat this, you may want to consolidate your super, which moves all your super into one account. Not only does this save on fees, but it also makes your super easier to manage and keep track of.

Before consolidating your super, it is important to do the following:

Research your funds' policy
Compare your active super accounts so you can make the right choice about which one you should close. Things to assess include:

  • Exit fees
  • Insurance policies
  • Investment options
  • Ongoing service fees
  • Performance of the funds

Check employer contributions
Changing funds may affect how much your employer contributes, as some employers contribute more to certain funds. Check your current accounts to see if changing funds will affect this. Once you have selected a super fund, regardless of whether you choose a new super fund or one of your existing ones, provide your employer with the details they need to pay super into your selected account.

Gather the relevant information
When consolidating your super, you will need to have the following details ready:

  • Your tax file number.
  • Proof of identity. This could include your driver's license, birth certificate or passport.
  • Your fund's superannuation product identification number (SPIN).
  • Your fund's unique superannuation identifier (USI).
  • Details of your previous fund.

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