Date of article: 28 May 2017
Last updated: 28 May 2017
There were a multitude of previously announced changes that will take effect from 1 July 2017. There was little in this year’s Budget relating to superannuation – a welcome change.
As part of the housing affordability package, the First Home Super Saver Scheme was introduced. From 1 July 2017, eligible individuals may voluntary contributions (personal non-concessional or concessional, deducted personal contributions or salary sacrifice contributions) of up to $15,000 a year, and up to $30,000 in total.
Concessional contributions and earnings that are withdrawn will be taxed at marginal rates less a 30 per cent offset. You must apply to the Australian Taxation Office to obtain an release authority prior to making the withdrawal.
Downsizer can contribute when they sell their home that they have owned for more than 10 years and use the proceeds to make non-concessional contributions. This measure will apply from 1 July 2018 to individuals age 65 for contributions up to $300,000 for an individual or $600,000 for a couple. These ability to make the contributions will not be subject to any age or work tests, and is in addition to any other contributions cap.
This measure is designed to provide an incentive for older Australian to downsize and save more in their superannuation in a concessional taxed environment.
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