FAQ's for End of Financial Year

Questions and answers for financial year-end 2018

Financial Year End Statements

> Unit price and transaction delays

UNIT PRICING, DISTRIBUTIONS, SAVINGS PLANS AND WITHDRAWALS

A unit price reflects the value of a fund’s investments, including any income accrued but not yet distributed. When distributions are paid, the unit price will usually decrease by an amount equal to the distribution. As a result, if your fund pays a distribution on 30 June, the unit price will generally decrease on the same day by the same amount.

Please note that if you fully withdraw units from your fund before 30 June, you will not receive a distribution for those units. If you partially withdraw units from your fund you will only receive a distribution for the units you still hold at 30 June.

Finalising year-end unit prices is a detailed process and takes time due to distribution calculations and review requirements. We expect unit prices for Perpetual’s funds to be available from mid-July.

For external fund manager investment options, we rely on the external fund managers to provide the information. This means it will take longer to finalise and we expect unit prices for external fund manager investment options to be available by late July.

The reinvestment of your 30 June distribution will be processed with an effective date of 1 July using the fund’s post-distribution price. This reinvestment amount will be incorporated into the opening balance on your Annual Statement for the following financial year and will not appear as a separate transaction on your 2017/18 statement. 

Distributions (if any) that will be reinvested are referred to as a ‘distribution awaiting reinvestment’. For example, if you receive a distribution for the period ending 30 June that you intend to reinvest, that amount is referred to as the ‘distribution awaiting reinvestment’ on 1 July of the following financial year. This is due to unit price delays and once received this will appear as a Distribution reinvested. On your Annual Statement for the following financial year, the reinvestment amount will be incorporated into the opening balance and will not appear as a separate transaction.

Your bank account will be debited as normal; however we will need to wait until the unit prices are available for all funds before your money can be processed into your account. This delay won’t impact you as you will receive the unit price for the effective date of your savings plan.

During July there may be delays in issuing unit prices as we finalise year-end distributions. While unit prices are unavailable, we are not able to process transactions, including withdrawals.

This delay will not affect the value of your investment or the value of any transactions made during the year-end period. When unit prices are issued, transactions will be processed for the day they were received and accepted.

We will endeavour to obtain the prices and process transaction requests as quickly as possible.

Yes, we expect the regular withdrawal plan to be affected by the unit pricing delays. We will need to wait until the unit prices come in for all funds before regular withdrawal plan payments are processed. Once we have the unit prices, clients should expect to receive their funds within five to seven business days.

In general, distributions that occur during the year reflect income only. If capital gains have been realised during the financial year, these are generally included in the June distribution.

Perpetual elected into the Attribution Managed Investment Trust (AMIT) regime for the majority of Perpetual’s investment funds for 2017/18 and subsequent years.  Each fund that has elected into the AMIT regime is now referred to as an AMIT.

No change has been made to the way in which distributions for the 2017/18 year have been paid.  No income has been accumulated in any fund as permitted under the AMIT regime and no distributions have been automatically reinvested in the fund (unless you have instructed us to reinvest).

TAX STATEMENTS & PAYG PAYMENT SUMMARIES – INVESTMENT FUNDS AND PENSION PLANS

Tax Statements are issued to:

  • Investment funds -all investors who have held units at any time during the 2018 financial year;
  • Pension members -who are less than 60 years of age; and

PAYG Payment Summaries are issued to:

  • Term Allocated Pension members -all members irrespective of age.

Pension members (excluding Term Allocated pension members) who are over 60 years of age and super members are not issued PAYG Payment Summaries.

The Tax Statement or PAYG Payment Summary helps you to complete your income tax return. We also provide a guide to help you understand your Tax Statement or PAYG Payment Summary. We recommend that you seek help from your financial and/or tax adviser or the ATO when completing your income tax return, as we are unable to provide you with tax advice. Please refer to  “Financial Year End Statements” for information on mailing times.

When we mail statements that contain information required to be included in your 2017/18 income tax return, we will enclose a tax guide to help you.

You should also refer to the information available on the ATO website.


PENSION PLANS

We have received an extension from the Australian Tax Office with respect to the date that 2018 PAYG payment summaries need to be issued. The PAYG payment summaries for Perpetual WealthFocus Pension Plan and Perpetual Select Pension Plan will be lodged with the mail house mid-July.

Pension payments from a Term Allocated Pension fall within the definition of a capped defined benefit income stream. The Australian Tax Office now requires that a PAYG payment summary be issued to Term Allocated Pension members over 60 years.

The PAYG payment summary is only relevant if you have received pension payments in excess of $100,000 from all capped defined benefit income streams you hold.

INVESTMENT FUNDS

To complete Tax Statements, we require full financial year-end information for each fund. This may include actual year-end financial information from external fund managers.

We finalise Tax Statements as soon as we receive all the relevant information, however the information from external fund managers may not be received until late July.

Perpetual elected into the Attribution Managed Investment Trust (AMIT) regime for the majority of Perpetual’s investment funds for 2017/18 and subsequent years.  Each fund that has elected into the AMIT regime is now referred to as an AMIT.

The AMIT regime requires that the Tax Statement issued to investors is now to be called an ‘AMIT Member Annual statement’, in short, an AMMA statement.

The AMMA statement is required to be issued to all investors, including non-resident investors.

The information shown on the AMMA statement is almost identical to the information that was shown on Tax Statements.  One small change is that the ‘Taxable Income’ column is now referred to as ‘Attributed Income’.

Perpetual elected into the Attribution Managed Investment Trust (AMIT) regime for the majority of Perpetual’s investment funds for 2017/18 and subsequent years.  Each fund that has elected into the AMIT regime is now referred to as an AMIT.

The AMIT regime uses the term ‘Attributed Income’ as the amount that has been distributed / allocated to the investor.  In previous years we referred to this as ‘Taxable Income’.

Franked dividends are received from Australian companies that have paid Australian company tax on their earnings. A franking credit attached to a dividend reflects the amount of tax that has already been paid by the company issuing the dividend.

When a fund receives a franked dividend, the fund may be eligible to pass on the attached franking credits to investors. The franking credit will partly or fully cover the tax payable on the distribution paid to you.

Unfranked dividends are received from Australian companies that have not paid any Australian company tax on their earnings.

Dividends unfranked (CFI) are unfranked dividends received from Australian companies that have declared this amount to be 'conduit foreign income'. These dividends are simply treated as 'unfranked' dividends by Australian resident investors. This distinction is only relevant for non-resident investors and custodians.

Perpetual elected into the Attribution Managed Investment Trust (AMIT) regime for the majority of Perpetual’s investment funds for 2017/18 and subsequent years.  Each fund that has elected into the AMIT regime is now referred to as an AMIT.

Where the fund is an AMIT, the member will be deemed to be a ‘qualified person’ in respect of the franked distribution and therefore does not need to apply the 45 day rule and is entitled to claim the whole of the franking credits distributed to them from the fund.

The only Perpetual fund that does not currently qualify as an AMIT and therefore has not elected into the AMIT regime is Perpetual's Charitable Endowment Fund.

Capital gains made by the funds have been split between 'TAP' (gains relating to taxable Australian property) and 'NTAP' (relating to non-TAP gains). This distinction is not relevant for Australian resident investors but may be relevant for non-resident investors and custodians.

CAPITAL GAINS TAX STATEMENTS

For Perpetual WealthFocus Investment Advantage, if you have withdrawn all or part of your investment during 2017/18, we expect to send you a Capital Gains Tax Statement by late July 2018 to assist you in preparing your 2018 income tax return.

We do not provide a Capital Gains Tax Statement if you have withdrawn units from any other Perpetual product.

If you require information to help you calculate capital gains/losses realised during 2017/18, please email us at investments@perpetual.com.au and request a Full Transaction Summary, quoting your client number and/or account number.

The amount shown under the Discount Method is the gross amount before applying any discount. The capital gains tax discount is 50% for individuals and trusts (other than complying superannuation entities) and 33.3% for complying superannuation entities. Companies are not entitled to a capital gains tax discount.

The capital gain disclosed in the Discount Method column on the Capital Gains Tax Statement represents the gross amount of the capital gain (ie before application of any discount percentage).

Tax-deferred distribution components received from your investment in Perpetual WealthFocus Investment Advantage have been taken into account, to determine the realised capital gain or loss shown on your Capital Gains Tax Statement.

PENSIONS PLANS AND SUPERANNUATION CONTRIBUTIONS

We will process your July 2018 pension payment when it is due using the last available exit price.

Investors in the Perpetual WealthFocus Pension Plan and Perpetual Select Pension Plan can change their pension payments for 2018/19 by completing and returning the pension changes form they will be mailed with their pension pack in July 2018. 

Age range           Percentage of account balance - standard
Under 65 4%
65 - 74 5%
75 - 79 6%
80 - 84 7%
85 - 89 9%
90 - 94 11%
95+ 14%

Yes, high-income earners earning more than $250,000 p.a. from July 2017 (previously $300,000) will be affected by the Division 293 tax. This means that an additional 15% contributions tax will be applied on concessional contributions above the $250,000 threshold.

You can contribute to your spouse’s superannuation account and receive a tax offset if your spouse earns less than $40,000 p.a. (previously $13,800). The maximum contributions you can claim a rebate on remains at $3,000 and the offset at $540. The maximum offset will begin to reduce if your spouse’s income exceeds $37,000 (previously $10,800).

The concessional contribution cap is $25,000 p.a. for everyone.

The non-concessional contribution cap is $100,000 p.a. for members with a total superannuation balance of less than $1.6 million on 30 June 2017.  If you are under 65 years, you may be able to use the bring-forward rule of 2 years ($200,000) or 3 years ($300,000), depending on your total superannuation balance as at 1 July 2017. A transitional cap will also apply if the bring-forward rule was triggered in 2015/16 ($460,000) or 2016/17 ($380,000).

From July 2017, investment earnings for TTR pension accounts will be taxed at 15%. A TTR pension is not considered to be in pension phase and therefore does not count towards your transfer balance cap.

Once you meet a condition of release from superannuation, such as turning 65, your TTR pension converts to an account-based pension and will then count towards your $1.6 million transfer balance cap.

A transfer balance cap of $1.6 million applies to limit the amount that can be transferred from superannuation to pension. Account balances above that amount will need to remain in superannuation where the earnings will continue to be taxed at 15% or can be withdrawn.

From 1 July 2018 you can apply to release voluntary contributions under the First Home Super Saver Scheme using your myGov account linked to the ATO. These voluntary contributions plus deemed earnings (at a rate which will be calculated by the ATO) will only be released when a release authority is provided to the fund from the ATO. Any amounts released by the fund are required to be paid to the ATO, who will then pay it to you.

You should also refer to information available on the ATO website.

ANNUAL STATEMENTS

‘Capital growth/loss’ is the unrealised difference between the opening balance at the beginning of the financial year (1 July) and the closing balance at the end of the financial year (30 June).

The ‘Return on investment’ (where applicable) is made up of unrealised capital growth/loss, gross distributions received, Member Advice Fee payments, Management Expense Ratio (MER) rebates received and ongoing commission rebates received, if applicable, during the financial year.