From July 1 this year, there are positive changes in pensions, which create more opportunities for growing eggs.
This is good news for retirees and people retirement planning. There are also potential benefits for people with lower incomes and those who want buy your first home.
Here is an overview of the major changes in retirement benefits and how they may affect you. These changes are good news, however, please note that this is only a high-level summary. Retirement and retirement planning is very complex, with a number of rules and eligibility criteria – so please make sure seek professional advice with relevant special knowledge.
1. The labor test was canceled for 67-75 years
Need to pass a job test for people aged 67 to 75 who want to personally contribute money (without benefits) to super or organize the victim’s salary is super their employer was fired.
However, for individuals who want to make a personal contribution to the super, what do they want claim a tax deductionthe job test requirement is still valid.
Important Note: In all references to age restrictions, please note that on July 1 of the financial year, individuals must be at least 74 years old, and contributions must be received no later than 28 days after the month in which the person turns 75 years.
See ‘what is a job test?’ below for more information on this change in pensions.
2. Spouse’s additional contributions
Withdrawal of the labor test also opens up the possibility of additional contributions from the spouses.
Currently, contributions from a spouse can only be made if the host spouse is under 70 years of age or if he or she is between the ages of 65 and 69 and meets the labor exams. Now the spouse can receive a contribution from the spouse up to 75 years. It can help boost your spouse’s rivalry and give you good tax credit.
3. Postpone the agreement age increased
Individuals under the age of 75 can now make preferential contributions with help make an agreement. It is currently restricted to customers under the age of 65.
This is where a superfund member can contribute up to $ 330,000 (provided they have not used the carry-over rule in the previous three years and some other conditions are met).
4. The minimum age of downsizers has decreased
Another big change in retirement benefits is that the minimum age for receiving a super contribution downsizer was reduced from 65 to 60 years.
The ability to make a down payment is caused by selling your home. The contribution of the reducer is especially valuable for individuals who have already used the contribution limit or have a high superbalance. This is because it is not included in the contribution limit and is not limited to the $ 1.7 million limit for “superbalance”.
5. The income threshold is removed from the Superguarantee
Upcoming changes in pensions are not just for older Australians. The $ 450 Super Guarantee (SG) income threshold will be removed, which will benefit all low-income individuals. This means that employers who did not have to pay contributions to SG for employees earning less than $ 450 a month now have to pay.
It has to give low-income people – increase on their pension. And if you are a business owner, you will need to review your processes to make sure SG is paid to all relevant employees.
6. Enlarged scheme of First Home Super Saver
The maximum amount that can be released The first Super Saver scheme for the home (FHSSS) was increased to $ 50,000 (plus related income).
It can help individuals save on your first home to save money in the midst of preferential tax. The scheme allows individuals to make voluntary contributions of up to $ 15,000 per year within their preferential and non-preferential superlimits, which they may later withdraw.
What is a job test?
This requires an individual to work for hire or self-employment to benefit or be rewarded for a minimum of 40 hours over a 30-day consecutive period during the fiscal year before making voluntary super-contributions. This includes personal contributions, salary sacrifice contributions or personal contributions that are not deductible. The working test does not apply to deductible contributions (see above).
What is an exemption from a labor test?
This allows individuals between the ages of 67 and 75 with a total superbalance below $ 300,000 on June 30 of the previous fiscal year to make voluntary super deposits within 12 months of the end of the fiscal year in which they last met. working test.
To make a super-contribution using a labor test exemption, you must do the following:
- you passed the job test in the previous fiscal year
- as of June 30 of the previous fiscal year, your total superbalance (for all superfunds) was below $ 300,000
- you have not previously contributed to the super using the exemption from the labor test.
The rules of retirement are very complicated. The contributions and arrangements we have outlined have a number of requirements for participation (not discussed here) that you need to understand before making a contribution. It is recommended to talk to a financial advisor and / or visit ATA website before contributing.