Amendments to proposed superannuation budget measures
Last week the Government announced changes to the superannuation measures announced in the 2016-17 Budget.
The main change being the measure proposing a $500,000 lifetime cap for non-concessional superannuation contributions will be replaced with a measure to instead reduce the existing annual cap of $180,000 (for 2015/16 and 2016/17) to $100,000 from 1/7/2017.
Individuals aged under 65 will continue to be able to ‘bring forward’ three years’ worth of non-concessional contributions.
There will be special transitional rules for those that have already triggered the ‘3 year bring forward rule’ for non concessional contributions, so if you are affected by these measures please contact your Stratogen Accountant to discuss further.
Individuals with a superannuation balance of more than $1.6m (tested at 30 June of previous financial year) will no longer be eligible to make non-concessional (after tax) contributions from 1 July 2017. The limit will be tied and indexed to the proposed transfer balance cap of $1.6m.
These measures mean that with their annual concessional contributions, Australians will be able to contribute $125,000 each year and, if taking advantage of the non-concessional ‘bring forward’, up to $325,000 in any one year until such time as they reach $1.6 million transfer balance.
The proposed abolishing of the work test from 1 July 2017 for individuals aged between 65 to 74 will now not proceed. This means the current restrictions on such individuals from making superannuation contributions will remain and individuals aged 65 to 74 who satisfy the work test will still be able to make additional contributions to superannuation.
The 1 July 2017 start date of the proposed catch-up concessional contributions measure will be deferred by one year to 1 July 2018. This measure allowed individuals with a balance below $500,000 to make additional concessional contributions where they have not reached their cap in previous years.
Legislation for all measures is expected to be introduced by the end of the year.
Want more information about superannuation and self managed super funds? We encourage employees on current salary sacrifice arrangements to contact your Stratogen Accountant to discuss the implications of these changes on 07 5474 0711.
Noosa Superannuation Accountants & Financial Advisors Sunshine Coast QLD
Stratogen Accounting consists of a team of expert accountants and highly qualified financial advisors who assist with all aspects wealth creation including self managed super fund (SMSF). Our accounting firm’s head office is located at Noosa on the QLD Sunshine Coast. Our expertise is unparalleled and thus we work with clients living interstate around Australia and internationally.
We offer the full range of services expected of a leading edge accounting firm. Our personal services for individuals include accounting, tax returns, superannuation funds and financial planning, estate planning, insolvency services and asset protection. Our approach to both our clients is practical, open and honest.
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