ABOUT one quarter of superannuation fund investors in Australia did not have their tax file numbers recorded, according to a survey by licensed securities dealer Count Wealth Accountants.
Count, Australia’s largest independently owned wealth advice network, surveyed 403,982 superannuation fund investors and found that 105,194 or 26.2 per cent did not have their TFNs recorded.
This would not normally constitute a huge concern, as it would be seen as an administrative issue that could easily be resolved.
However, it becomes an issue when investors have not provided their TFNs to the superannuation fund as it will mean they will be liable for an additional 15 per cent tax on their contributions.
This will mean that they would pay a total tax on their contributions of 30 per cent, not 15 per cent as others would.
Malcolm Stewart, from local accounting firm MJS Business & Financial Services, an authorised representative of Count Wealth Accountants, said he was “astounded by the number of Australians who are affected by this hidden tax”.
“We are all living longer and healthier lives and people simply can’t afford to lose one-third of their retirement wealth,” he said.
Mr Stewart said investors who have received the notification that their fund has not got their TFN needed to check their last superannuation statement. Australians have an average of 2.8 superannuation fund accounts each, so each fund would have to be checked.
The TFN must be provided to all superannuation to avoid the surcharge.
If a TFN has not been recorded, it must be sent the superannuation fund.
Mr Stewart said it was important to request written confirmation that the TFN has been recorded. If your income is less than $98,955 you should also ask for written confirmation that the excess surcharge tax deducted has been refunded to your account.
Mr Stewart’s warning is appropriate. There are vast numbers of Australian superannuation fund investors who have no idea about the funds credited to their name, let alone any other related information.
The pleas of financial commentators for us to take better control of our financial affairs appear to continue to fall on deaf ears.
We need, in an era of longer life spans to ensure that we can afford our retirement lifestyle.
