Here’s a recap of the key super changes from 1 July this year and how they might affect you. These changes apply for the 2017/18 financial year and onwards.
If you are...
Making before-tax contributions
The limit on before-tax (concessional) contributions is now $25,000 per financial year for everyone. This includes the 9.5% your employer contributes to super each year. If you put extra into your super, make sure you won’t go over the new annual cap.
Making personal payments
Anyone under the age of 74 can now make personal contributions to their super, up to the annual $25,000 cap, and claim them as a tax deduction.
However, if you’re aged between 65 and 74, you’ll need to meet the work test to be eligible.
Making after-tax contributions
The limits on after-tax (non-concessional) contributions are now $100,000 per year or $300,000 over three years (if you’re under age 65). If you’re over age 65 and want to make after-tax contributions, you’ll need to meet the work test.
If you have a super balance over $1.6 million, you won’t be able to make any after-tax contributions. If you’re in the middle of bringing forward contributions over a three-year period, get in touch and we’ll help you work out the next steps. considering a transition to retirement pension (TTR) or already have one
The earnings on a TTR account are no longer subject to a tax exemption (and are now taxed at 15%). However, a TTR pension may still be a good way to grow your super while you ease into retirement. Get in touch and make a time to speak with one of our qualified financial planners.
Looking to retire
You can transfer a maximum of $1.6 million from your super to a pension account. Any money above this amount will need to stay in your super account.
Earning over $250,000 per year
You’ll pay 30% on your annual before-tax contributions. The usual 15% tax will apply when you make contributions to your super fund and an extra 15% will be payable by you to the ATO at tax time.
It pays to get advice
We know super can sometimes be complicated, that’s why we’re here to help.
If you have any questions about the super changes and what they mean for you, give us a call on 1300 362 415 or email us and we’ll get back to you.