The superannuation reforms that were legislated from last year’s Budget have been in effect since 1 July 2017.
The reforms might mean you need to make some changes to your superannuation plans:
- Contribution caps have been reduced. If your super contributions were equal or close to the previous contribution caps, you will need to adjust these so your annual contributions don’t breach the new caps. Before-tax contributions are now capped at $25,000 per year, and after-tax contributions at $100,000 per year.
- A transfer balance cap of $1.6 million has been introduced to all pension accounts. If your pension balance is above $1.6 million, you will need to transfer the excess to an accumulation account or withdraw it from super.
- The thresholds for the spouse contribution tax offset have been increased. If your partner earns less than $40,000 and you contribute to their super account, you may receive a tax offset on your contribution [up to $540]. Previously, this tax offset was only available to those whose partners earned less than $13,800.
- Tax deductions are now available to all individuals who make personal contributions to their super accounts. If you are currently unable to contribute to your super through salary sacrificing, this tax deduction could help you make tax-advantaged contributions. Call 1300 001 360 to book an appointment with an Intrust360° financial adviser, and find out how to take advantage of this deduction.
- Investment earnings in TTR accounts will now be taxed up to 15 per cent. This could impact the benefits of your strategy. Those in a Transition to Retirement (TTR) account need to think seriously about whether they can transfer to an account-based pension.
If you need help making sure you’re still adhering to the rules, or you’re unsure if you will need to change your TTR strategy, give the Intrust Super team a call on 132 467.