EXPLANATORY MEMORANDUM

							                           EXPLANATORY MATERIAL

                    Corporations Amendment Regulations 2004 (No. )

The Superannuation Government (Co-contribution for Low Income Earners) Act 2003 (the
Act) and the Superannuation Government (Co-contribution for Low Income Earners)
(Consequential Amendments) Act 2003, replace the low income earner superannuation
taxation offset for undeducted personal superannuation contributions with a Government
superannuation co-contribution.

Section 55 of the Superannuation (Government Co-contribution for Low Income Earners)
Act 2003 (the Act) provides that the Governor-General may make regulations prescribing
matters required or permitted by the Act to be prescribed, or necessary or convenient to be
prescribed for carrying out or giving effect to the Act.

The general purpose of the proposed amendments is to support the necessary administration
requirements of the Act.

Explanation of the Amendments

Regulation 1 specifies the name of the regulations as the Corporations Amendment
Regulations 2004 (No. ).

Regulation 2 provides that the regulations commence on 1 July 2004.

Regulation 3 provides that Schedule 1 amends the Corporations Regulations 2001.

Schedule 1 - Amendments

Items 1 to 4

The proposed regulations would amend subregulation 7.9.01(1) of the Corporations
Regulations 2001 to include a definition of a ‘net amount of Government co-contribution
received’. This definition will include all amounts credited to a superannuation fund member
or Retirement Savings Account (RSA) holder less any amounts repaid to the Commissioner
of Taxation during a reporting period.

The proposed regulations would amend subregulation 7.9.01(1) of the Corporations
Regulations 2001 to include definitions of ‘Government co-contribution’, ‘superannuation
provider’ and ‘RSA’.

Items 5 to 8

The proposed Regulations would amend subregulations 7.9.20(1) and 7.9.26(1) of the
Corporations Regulations 2001 to require trustees of superannuation funds (other than self
managed superannuation funds) and RSA providers to report to members and account holders
about Government co-contributions that have been credited to a person’s account. This
would be done via the existing periodic statement processes that exist. The additional item
that would be required to be reported under these proposals would be the ‘net amount of
Government co-contribution received’ during the reporting period, as defined in the above
mentioned proposed amendment to subregulation 7.9.01(l).

Items 9 and 10

The proposed regulations would amend subregulation 7.9.62(4) of the Corporations
Regulations 2001 to exempt superannuation providers from confirming a transaction relating
to a Government co-contribution. Much of the administrative design for the co-contribution
measure is based on the reporting system used for superannuation surcharge purposes. This
proposal is consistent with the treatment of superannuation surcharge liabilities in this
provision.