ATO to provide super details in Family Law property matters
An amendment bill has now been introduced into Parliament to permit the Australian Taxation Office (ATO) to provide details about the superannuation accounts of a party to a Family Law property proceeding.
Given that superannuation accounts are, after the matrimonial home, likely to be the most significant financial assets of a married couple, it is vital for a fair property proceedings outcome that each party disclose their superannuation interests to the other. Non-disclosure of a material superannuation asset is a ground for setting aside a Family Law property settlement.
Once a superannuation account is disclosed by one party, the other party can then directly contact the trustee of the relevant superannuation fund for detailed and up to date valuation information of the account under existing family law provisions. However, if a party does not disclose (even though they should) a superannuation account, the other party will not have the contact information to permit a disclosure request to be made.
The new legislation (set in Schedule 5 of Treasury Laws Amendment (2021 Measures No 6) Bill, 2021) will address the issue of non-disclosure of superannuation accounts. Once the provisions are in operation (which is proposed to be 1 April 2022), a party to Family Law property proceedings may request the Family Court Registrar to obtain from the ATO, details of the superannuation accounts of the other party to the proceedings.
The ATO, upon receipt of a request from the Family Court Registrar, will review its information base and, if a match is found, provide the information to the Registrar who, in turn, will provide the information to the requesting party. The requesting party is then in a position to contact the relevant superannuation providers for more detailed and up to date balance information (given that the account values held by the ATO are not generally current values) using the current disclosure procedures under the Family Law Act.
The request for superannuation information must go through the Registrar; it will not be possible for a party to Family Law property proceedings to contact the ATO directly; the ATO will decline the request and must, by law, decline the request given the secrecy provisions of the taxation law. The Bill will amend those secrecy provisions to permit disclosure to the Registrar and by the Registrar to the requesting party. Any superannuation information obtained by the Registrar and disclosed to a party to the Family Law property proceedings must only be used for the purposes of those proceedings.
The type of information which can be disclosed will be:
- The identity (i.e. fund name and contact details) and value of each superannuation interest (whether held in a super fund, approved deposit fund or a retirement savings account or in a superannuation annuity) held by the person who is the subject matter of the enquiry being the details and value most recently reported to the ATO.
- Any account in the name of the person who is the subject of the enquiry containing small amounts of ATO held superannuation.
- Any amount of unclaimed superannuation (such as amounts in lost member and inactive low-balance accounts), any shortfall amounts and Government Co-contributions payable to or held for the benefit of the person who is the subject of the enquiry.
The ATO will not disclose the residential address of the person who is the subject of the enquiry.
The new information disclosure provisions will apply to Family Law property proceedings which are on foot on 1 April 2022, or which are commenced after that date. Most importantly, the new information disclosure provisions will not apply unless court proceedings have commenced.
For further information, please call Townsends Business & Corporate Lawyers on (02) 8296 6222 or email info@townsendslaw.com.au.