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Some SUPER News

We have been hearing a lot of not-so-good issues lately so I thought I’ll share some SUPER news instead, to brighten up your day!

Let’s start. Did you know that:

  1. If you are an employee, you can now top-up the super contributions paid by your employer by making contributions personally and then claim a tax deduction? Yes you can, as long as your total contributions (both employer and personal) do not exceed $25,000. This is effective 1 July 2017. However, before lodging your tax return, make sure that you lodge a Notice of Intention to Claim a Deduction form with your super fund and you must also receive an acknowledgment of receipt of this notice from the fund.
  2. From 1 July 2018, if your Total Superannuation Balance (TSB) is less than $500,000 at the end of the financial year, you can make additional contributions by utilising the unused portions of your concessional caps from previous years, for up to 5 years. The first year in which individuals can take advantage of this ‘catch up’ provision would be the 2019/20 year.
  3. The non-concessional (after tax) contribution that an individual can make is capped at $100,000 for the 2018/19 year. However, if you are under 65, you can contribute more than this amount without worrying about excess contributions, by triggering the “bring forward” rule; that is, you bring forward the contributions allowed for the following 2 years. Just be mindful not to exceed $300,000 over the 3-year period. The amount will also be limited if your Total Superannuation balance (TSB) is more than $1.4m. If your TSB is more than $1.6m, you cannot make non-concessional contributions.

For those over 65 (and under 75), you are not allowed to use the bring-forward rule, regardless of your TSB. In addition, make sure that you satisfy a work test before making super contributions. In order to satisfy the work test, you must work for at least 40 hours within 30 consecutive days in the year you intend to make a super contribution.

However, it is proposed that, with effect from 1 July 2019, an individual who is over 65 (and is under 75) can still make super contributions if he/she:

  • Does not satisfy the work test in that year;
  • Satisfied the work test in the previous year;
  • Has a total superannuation balance under $300,000 in the preceding year; and
  • Has not made contribution under these Rules earlier.

 

Written for you by Rowell Corpuz

 

 

 

The information contained on this website and in this article is general in nature and does not take into account your personal situation. You should consider whether the information is appropriate to your needs, and where appropriate, seek professional advice from a financial adviser. Taxation, legal and other matters referred to on this website and in this article are of a general nature only and are based on our interpretation of laws existing at the time and should not be relied upon in place of appropriate professional advice. Those laws may change from time to time.

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