SUPERANNUATION: Get prepared for changes.
SUPERANNUATION: Get prepared for changes.

Get prepared for superannuation changes

ARE YOU ready for the biggest superannuation changes in the past decade?

Last month we discussed significant upcoming changes to Superannuation.

Super remains a key tax-effective investment available to many Australians.

The key changes are:

  • $100,000 annual cap on non-concessional contributions.
  • Concessional contributions limit for everyone reduced to $25,000.
  • Non-concessional contributions restricted to those with less than $1.6m in superannuation.
  • Amounts held in pension accounts will be limited to $1.6m.
  • Investment earnings of transition to retirement pensions to be taxed at 15%, the same as super accumulation accounts.

It is worth discussing with your financial adviser:

  • How to maximise your concessional contributions before July 1st (the ones you make before your income tax is taken out - from employer; salary sacrifice; anywhere you've claimed a tax deduction) and receive the benefit of a 15% tax rate.
  • How to maximise your non-concession contributions before July 1st: if you plan ahead you can maximise what you can contribute this financial year and compound that with maximum contributions next financial year. e.g Scenario 1 : Mary has $150,000 she could add to her super before July 1. She also has $280,000 from a house sale coming in next financial year. This totals $430,000. However if she waits until July 1st to manage this she will be limited to $300,000 by the new rules. eg - Scenario 2: Bob has not added to super for a few years but this year he received inheritance of $490,000. Until June 30th 2017 he has the option of placing ALL of this in super. If he waits to July 1st he is limited to $300,000 by the new rules.
  • Review your Pension if your holdings are around the $1.6 million mark: any monies in excess of this will need to be moved back to an accumulation account (not pension) and taxed at 15%. You will also have the option to move that excess to another investment structure.

Now is the time to be in discussion regarding maximising your superannuation investments.

For more Information contact Tim Maher at Maher Digby Securities Pty Ltd - Financial Advisers - AFSL No. 230559 (see advert Page 3). Ph: 07 5441 1266 or visit our website

This document was prepared without taking into account any person's particular objectives, financial situation or needs. It is not guaranteed as accurate or complete and should not be relied upon as such. Maher Digby Securities does not accept any responsibility for the opinions, comments, forward looking statements, and analysis contained in this document, all of which are intended to be of a general nature. Investors should, before acting on this information, consider the appropriateness of this information having regard to their personal objectives, financial situation or needs. We recommend consulting a financial advisor.

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