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Super Contribution Changes – Published on May 29, 2017
- Contributions reduced to $25,000 p.a.
- Non-concessional contributions reduced to $100,000 p.a.
- 3-year bring-forward cap reduced to $300,000
- High income threshold reduced to $250,000
- Removal of ‘work test’ for tax deductible contributions
- Carry-forward of unused cap introduced.
Super Pension Changes
- Introduction of a transfer balance cap of $1.6 million in super retirement pensions.
- Indexed in line with CPI in $100,000 increments.
- Earnings on assets backing a Transition to Retirement Pension no longer tax-free.
- Impact on Estate Planning, Reversionary Pensions and Death Benefit Pensions.
From 1 January 2015, many retirees will be impacted by changes the Federal Government is making. There will be changes in the way certain superannuation income streams (such as Account Based Pensions) are assessed under the ‘Income Tests’ for various Government benefits. These changes may affect many retirees – including those eligible for Age / DVA Pensions and self-funded retirees eligible for the Commonwealth Seniors Health Card. The new assessment rules will likely lead to higher ‘assessable’ income under the Income Tests for many clients, which may result in reduced entitlements in certain circumstances. Retirees only have a very short window to assess their current situation and make any relevant changes to ensure their financial situation is optimally set-up leading up to the 31 December 2014 deadline. Beyond this time, some of your options may be severely restricted and your entitlements adversely affected. This video discusses these changes, how they may affect some clients and what clients need to do to ensure their financial arrangements are efficiently structured before the 31 December 2014 cut-off date.
After watching this video, if you feel your situation may be affected, we urge you to contact us as soon as possible to assess your situation and make any required changes.
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