Some of the key takeaways from this budget include:
● Removal of the work test. From 1 July 2022, individuals up to the age of 74 years will be allowed to make or receive non-concessional or salary sacrifice super contributions without meeting the work test.
● Downsizer contribution. The Government will reduce the minimum age requirement for the downsizer contribution from 65 to 60.
● First Home Super Saver Scheme. From 1 July 2022, the Government will increase the amount of super savings available to first home buyers from $30,000 to $50,000. ● SMSF residency requirements. The Government will amend the SMSF residency requirements to make it easier for funds to maintain their complying status when members move overseas. ● Complying income stream conversions. Individuals will be given two years to exit a specified range of complying retirement income stream products, such as term allocated pensions. ● Aged care reforms. In response to the Royal Commission into Aged Care Quality and Safety, the Government is investing $17.7 billion over five years to improve the aged care system.
It is important to understand that these are proposals and will only become applicable if the super measures become law.
Information has been sourced from: www.budget.gov.au/2020-21
Superannuation Caps 2021-2022
The ATO has released Key super rates and thresholds for 2021-22 on their website, including: ● Non-concessional contributions cap: $110,000
● Concessional contributions cap: $27,500
● Lifetime CGT cap: $1,615,000
● Tax-free part of genuine redundancy payment: Base amount $11,341+ $5,672 per full year of service
● Super co-contributions: Lower threshold: $41,112, Upper threshold: $56,112
● Low-rate cap: $225,000
● Untaxed plan cap: $1,615,000
Information has been sourced from ATO
Knowing where to find online resources can be challenging. We’ve done the leg work for you and will provide information regarding useful resources each newsletter :
First Home Owner
First home super saver scheme
The first home super saver (FHSS) scheme was introduced by the Australian Government in the Federal Budget 2017–18 to reduce pressure on housing affordability.
The FHSS scheme allows you to save money for your first home inside your super fund. This will help first home buyers save faster with the concessional tax treatment of superannuation.
https://www.ato.gov.au/individuals/super/withdrawing-and-using-your-super/first-home-super-saver -scheme First Home Owner | State Revenue Office
If you are buying or building a new home valued up to $750,000, you may be eligible for a First Home Owner Grant (FHOG).
Buying your first home is a major financial decision so it’s important to understand your financial responsibilities and what help is available to you. You can find this information at:
http://www.sro.vic.gov.au › first-home-owner
End of Financial Year reminders – Superannuation
Ensuring contributions are made before 30 June. When a contribution is made can be an important factor for many super rules, such as:
∙ A super contribution can only be deductible in the financial year it is made; ∙ Whether a fund is able to accept a contribution (e.g. member’s age and any related work-test requirement) is assessed at the time the contribution is made; ∙ A super contribution can only count towards a client’s contributions cap in the financial year it is made or allocated. Reminder – the importance of lodging a valid notice of intent. It is important to note that in order to claim a tax deduction, the member must lodge a valid Notice of intent to claim a deduction form with their super fund and receive an acknowledgement from the fund, by the earlier of:
∙ Lodgement of tax return for the year in which the contribution was made ∙ 30 June of the following financial year ∙ Commencement of an income stream based in whole or part on the contribution In addition, any withdrawals or rollovers could partially or fully invalidate a subsequently lodged notice of intent. For this reason, it is important to lodge the notice of intent and receive an acknowledgement from the fund prior to a partial or full withdrawal or rollover.
Don’t miss out on the Government co contribution If your income (ie assessable income, reportable fringe benefits and reportable employer super contributions) is less than $54,837 and at least 10% of this income is derived from employment activities (including self-employment), you may be entitled to the government super co-contribution of up to $500 where you make a personal non-concessional contribution to super.
Please contact your adviser to discuss your individual circumstances:
Michael Grech - firstname.lastname@example.org Mobile : 0425 854 830
Daniel Meilak - email@example.com Mobile: 0431 894 036
Michael Grech, Daniel Meilak & Hobsons Bay Financial Planning Pty Ltd trading as Central Wealth Financial Planning are authorised representatives Consultum Financial Advisers Pty Ltd Australian Financial Services Licensee AFSL 230323.
Any advice or information in this publication is of a general nature only and has not taken into account your personal objectives, financial situation and needs.. Because of that, before acting on the advice, you should consider its appropriateness to you, having regard to your personal objectives, financial situation and needs.
The information in this document reflects our understanding of existing legislation, proposed legislation, rulings etc as at the date of issue. In some cases, the information has been provided to us by third parties. While it is believed the information is accurate and reliable, this is not guaranteed in any way.
Opinions constitute our judgement at the time of issue and are subject to change. Neither the Licensee, nor their employees or directors give any warranty of accuracy, nor accept any responsibility for errors or omissions in this document. Members of the IOOF group of companies (IOOF Group), associated employees or agents may have an interest in or receive monetary or other benefits from the financial products and services mentioned. The Licensee is part of the IOOF Group, and we may recommend financial products issued by companies within the IOOF Group.