The government recently announced their revised superannuation proposals which are expected to take effect from 1 July 2017.
The changes are significant and will affect many, however they also create a small window of opportunity.
What are the changes?
- Reduced non-concessional (after tax) superannuation contribution limits from $180,000 to $100,000 p.a.
- Reduced concessional (deductible) superannuation contribution limits from a maximum of $35,000 p.a. (age dependent) to $25,000 p.a. and additional taxes for those earning more than $250,000 p.a.
- A $1.6 million cap on amounts that can be used to commence a pension
- Inability for those with balances over $1.6 million to make further after tax contributions
- Changes to the tax treatment of Transition to Retirement Pensions making them less appealing
- Removal of concessions on superannuation death benefit taxes
Where are the opportunities?
- Those with the means to make after tax superannuation contributions of up to $540,000 each
- Individuals with superannuation balances close to or exceeding $1.6 million
- Spouses with large differences in their superannuation balances
- SMSF members aged between 56-59
- Reducing superannuation death benefit taxes (action can be taken now)
Whilst the majority of legislative changes remove or reduce tax concessions it’s critical to take advantage of the available opportunities.
Obtaining professional advice is the first step to ensure your affairs are organised most efficiently.
ACADIA WEALTH ADVICE – BIG FIRM EXPERTISE, BOUTIQUE SERVICE
Disclaimer This information is general advice and doesn’t take into account any person’s objectives, financial situation or needs.