Significant changes to superannuation are soon to commence. This article explores these changes, and some strategies you may wish to consider before the 1 July 2017 start date. Overview On 23 November, the Australian government passed a range of significant superannuation measures into law including: • From 1 July 2017 only individuals with a superannuation account balance below $1.6 million (the vast majority of the population) are permitted to make non-concessional (after- tax) contributions to their fund • For those that remain eligible, the contribution cap for this type of contribution will be reduced to $100,000 per year or $300,000 over three years from 1 July 2017 (down from $180,000 or $540,000 respectively) • Concessional contributions (e.g. Superannuation Guarantee, salary sacrifice, and contributions for which you can claim a deduction) will be capped at $25,000 per year from 1 July 2017 (down from $30,000 or $35,000 for those aged 50 or over) • Allowing all individuals eligible to contribute to superannuation a deduction for their personal, after-tax contributions up to the $25,000 concessional contribution limit from 1 July 2017 • Taxing the earnings in respect of Transition to Retirement Income Streams (TRIS) at 15% (up from 0%) from 1 July 2017. This will apply to all TRIS pensions irrespective of their commencement date • Reducing the income threshold at which taxpayers are charged an extra 15% tax on their concessional contributions from $300,000 to $250,000 from 1 July 2017 • Allowing individuals with superannuation balances below $500,000 to make ‘catch up’ concessional contributions. This will assist an estimated 230,000 individuals with broken works patterns (the overwhelming majority of whom are women) better provide for their retirement. pindaramagazine.com.au Pindara Magazine 103
Pindara Private Hospital Magazine - Issue Nine
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