Superannuation Changes happening 1 July 2017
There are reforms to Superannuation that become effective from 1 July, 2017. This means you have until 30 June, 2017 to act using the existing superannuation rules. Here are the main items you need to consider:
- Tax deductible Superannuation Contributions
- For 2017, you may contribute and claim either $35,000 (if you were 49 years or older on 30 June 2016) or $30,000 as a tax deduction.
- From 1 July 2017, this amount is reduced to $25,000 per member.
ACTION: Maximise the higher tax deduction available in 2017 financial year.
- Non-concessional contributions
- For 2017, you can contribute your own capital to superannuation up to a maximum amount of $540,000 using bring forward rules.
- From 1 July 2017, this amount is reducing to a maximum of $300,000 per member. Should your balance exceed $1.6m, you will not be able to contribute any new capital after this date.
ACTION: If you have capital you want to contribute to your Super Fund, consider depositing before 30 June 2017.
- Member Balances of $1.6m and over
- For 2017, if you are in pension mode in your Superannuation Fund, the entire Fund is tax free on its earnings regardless of your balance.
- From 1 July 2017, the earnings on the portion over $1.6m will be taxed at 15%.
ACTION: Check your members balances before 30 June 2017 and the valuation of assets.
- Transition to Retirement Pensions
- For 2017, these types of pension make your superannuation balance tax free on its earnings.
- From 1 July 2017, the earnings on these balances will be subject to tax at 15%.
ACTION: Consider if you qualify for an Account Based Pension from 1 July 2017 as these are remaining tax free (up to $1.6m per member).
We are recommending all Superannuation Fund Trustees and Members check the impact of these changes well before 30 June 2017.
Jason Birch is a Representative of Skybridge Portfolios Pty Ltd (ABN 47 149 093 069) trading as Skybridge Financial. Skybridge Portfolios Pty Ltd is a wholly owned company of Skybridge Financial Pty Ltd (A.C.N 124398385) and provides financial services through its Australian Financial Services License (AFSL No 407092). This information is of a general nature only and does not take into account your objectives, financial situation or needs. Before making any decisions you need to obtain personal advice from your advisor.