Investors
P: 1800 658 404
View full details
Financial advisers
Contact your state account manager or our client services.
View full details
Shopping Centres
For leasing, casual leasing and brand solutions enquiries
Contact Us
Connect with us to stay up to date with news and updates.

LinkedIn

New doors opening from 1 July


From 1 July 2017 onwards new superannuation measures will make it easier to save for retirement, particularly for those who’ve struggled to contribute in the past.

 

Tax-deductibility of super contributions

Under existing rules, tax deductions for personal super contributions are limited to those earning less than 10% of their income from waged employment – which in practice means people who are self-employed or who receive most of their income from investments.

From 1 July 2017, the 10% restriction will be lifted and anybody will be eligible to claim the deduction.

This presents great opportunity, particularly for part-timers, casuals and those between jobs, who have traditionally struggled to contribute to super.

Case study - Fran

Fran has had a number of casual and part-time jobs and is expecting a baby in December 2017, at which point she’ll stop working for the rest of the financial year. Some of her casual jobs were for one or two days per week which meant she earnt less than the monthly income threshold for superannuation guarantee payments.

From 1 July 2017 Fran will be able to make tax-deductible super contributions up to the concessional contributions cap. This will provide her with a tax incentive to top up her superannuation.

Also, depending on her earnings she may also consider making non-deductible super contributions to qualify for the government’s co-contribution. The maximum co-contribution payable is $500 based on a personal contribution of $1,000.

Carry-forward rule

Another new measure, effective 1 July 2018, is the ability to carry forward unused concessional contributions for up to five years.

If Fran is unable to make contributions in the year that she ceased work, she can carry forward the unused amount to a later year, provided her total super balance is less than $500,000.

For example, if Fran’s unused concessional contribution entitlement is $20,000 in 2017/18, she can carry it forward to make $45,000 worth of concessional contributions in 2018/19 ($20,000 carried forward plus $25,000 pertaining to 2018/19).

The new measures taking effect from 1 July 2017, improved access to tax deductions and the carry-forward rule, present good opportunity for trustees and their advisers to consider and harness.

About the author
Graeme Colley is the Executive Manager, SMSF technical and Private Wealth at SuperConcepts. Graeme is a well-known figure in the SMSF community with a long-standing reputation as an accomplished SMSF educator, technical expert and advocate for the sector. Most recently, Graeme was Director, Technical and Professional Standards at the SMSF Association.

Have a question on the Budget changes?

Visit the SMSF Community where you can share your thoughts, ask your questions or hear the concerns of other SMSF trustees.

Learn more

 

Taking your SMSF to the next level
Download now

Sign up to our newsletter!

Receive regular insights and marketing communications including a weekly update of trending news and market insights that are tailored for SMSF trustees and investors.
Sign me up
AMP's Australian operations are bound by the current Australian privacy legislation which outlines how organisations should manage and use personal information collected and held about their customers. AMP Privacy Policy

Thanks for subscribing

Thank you for subscribing to our weekly highlights newsletter.
Your privacy is important to AMP Capital and we are bound by the current Australian privacy legislation. View our privacy policy
Submit and close

Sign up to our newsletter!

Receive regular insights and marketing communications including a weekly update of trending news and market insights that are tailored for SMSF trustees and investors.
AMP's Australian operations are bound by the current Australian privacy legislation which outlines how organisations should manage and use personal information collected and held about their customers. AMP Privacy Policy
Sign me up Not right now. Thanks

Sign up to our newsletter!

Receive regular insights and marketing communications including a weekly update of tending news and market insights that are tailored for SMSF trustees and investors.
AMP's Australian operations are bound by the current Australian privacy legislation which outlines how organisations should manage and use personal information collected and held about their customers. AMP Privacy Policy
Sign me up