Substantial Superannuation Changes Take Effect From 1 July 2017.

Posted Under: None Posted On 24/04/2017



Simplified, there are 2 major changes to superannuation that you need to be aware of, and particularly if relevant to you we need to act to make the necessary changes and give the necessary advice in time for the July 1 cut-off.

1.6 million transfer balance cap – Effective from 1 July 2017, for every Australian, a cap of $1.6 million will be imposed on the amount of super that can be transferred into pension phase, and effectively force Australians to remove super benefits from pension phase if a pension account balance exceeds this amount as at 1 July 2017. The cap will be applied to both current retirees and to individuals yet to enter their retirement phase. If you do not reduce your retirement phase interests to or below the cap level prior to 1 July 2017 you will have to pay excess transfer balance tax.

Contributions – From 1 July 2017 annual concessional (before-tax) contributions cap will be reduced to $25,000. There is also a cut in the annual non-concessional (after-tax) contributions cap to $100,000. And from 1 July 2017, more Australians will pay double contributions tax (15% +15%) due to the lowering of the income threshold from $300,000 to $250,000.  Australians with adjusted taxable income of $250,000 or more will be hit with extra contributions tax, which means all concessional contributions will be hit with 30% tax rather than 15% tax.

You have until 30 June to take action if you are looking to take advantage of current contribution rules to contribute additional funds into superannuation or to avoid having to pay excess transfer balance tax. Call me at A Counting House 55261855 for a free chat to review your personal situation.

Albert Evans

p.s. I just realised that it is only 9 weeks till June 30 so it’s important to have that chat sooner rather than later, so if changes need to be made that we have plenty of time to do it. You don’t want to pay more tax than you already do now!

p.p.s. Oh, and our initial chats are free and no obligation. Just a special service we offer at A Counting House to our valued clients. Call me.