With the end of the financial year fast approaching, we’d like to remind you about some potential opportunities for super contributions.
There are a number of strategies that may be of benefit in the lead up to 30 June, particularly with new laws coming into effect on 1 July:
Co-contributions: Individuals who are working and have Assessable Income + Reportable Fringe Benefits & Reportable Employer Super contributions under $51,021 can qualify for some matching from the government – it’s free money in your super!
Self employed deductible contributions: those looking to reduce their taxable income can consider a contribution to super before 30 June, either personally (sole traders/partnerships) or from the company (Pty Ltd business operators). Be mindful of the limits outlined below.
Employees Salary Sacrifice: Salary Sacrifice arrangements are a very effective means of reducing taxable income and boosting retirement savings. Again, be aware of the limits.
Spouse Contributions – A tax rebate (maximum $540) may be available for after-tax contributions to super on behalf of a low-income spouse.
Some things to be mindful of:
Timing of payments: ensure contributions are made in time to be applied before 30 June, or they will likely be counted against next financial year’s limits.
Contribution caps: for the current financial year, Concessional Contributions (employer compulsory, salary sacrifice and member contributions where a tax deduction is claimed) are limited to $30,000 for who were under age 49 on 30 June 2016, or $35,000 for those who were 49 or over at 30 June 2016.
Employer payment of insurances or fees can also count against these limits, in some cases being funded by additional contributions.
Super changes are coming:
As outlined in our Summer newsletter a number of super changes are happening as of 1 July 2017. For those considering a large contribution to super to beat the deadline, the clock is ticking!
With investment markets posting some positive movements, it is a great opportunity to invest in a tax effective manner. If contemplating any contributions, please clarify your individual situation with your AGS planner or accountant.
As always please contact us for any advice or assistance.
Published : 27 Mar 2017