Superannuation and Pensions

26 Nov 12

1. - Maximise Personal Deductible Contribution

Personal contributions made by individuals who are self employed and satisfy the 10% rule are elegible to be claimed as a tax deduction. The maximum deduction that can be claimed is $25,000 if the taxpayer is under 50 or $50,000 if the taxpayer is 50 or older.
Taxpayers who turn 50 any time during the financial year are entitled to access the higher $50,000 concessional contribution limit irrespective of when the contribution is made during the financial year, which means that to access higher contribution limit, if you are turning 50 in this financial year, you must have celebrated your 50th birthday before or on 30th June 2010

2. - Contributions for Spouse - Superannuation Tax Offset

Taxpayers are entitled to a maximum $540.00 tax offset for superannuation contributions made on behalf of a low income or non-working spouse.  The maximum rebate of $540.00 is based on 18% of a maximum $3,000 non-concessional contribution.
The maximum rebate is reduced by $1 for each $1 that the total of the spouse's assessable income, reportable fring benefits and reportable employer superannuation contributions exceeds $10,800 cutting out completely one this figures reaches $13,800.


3. - Superannuation Guarantee

Super will increase from 9% to 12%. Nothing will change for 3 years; in fact we only get a 0.5% increase in the next 5 financial years.
The delay for three years will allow employers to factor the increase into their wage negotiations, which recognises that employees indireclty pay for the SG themselves.


4. - The age pension age

Will be gradually increased from age 65, commencing on 1 July 2017, and reaching age 67 on 1 July 2023, for both men and women. This is an increase of six months every two years.

Introducing this reform from July 2017 gives a considerable lead time for people to adjust to the change. The phase in of the increase age mirror the rate of increase of the pension age for women which is currently increasing and will reach 65 years on 1 July 2013.

5.- Commence a Transition to Retirement Pension before 30th June 2010

If a member of an SMSF is over the preservation age (55 years for those members born before 1960) and working, he can commence an income stream from his superannuation interest from 1st July 2009 as long as minimum amount is withdrawn as an income stream before 30th June 2010.
The pension assets of the SMSF supporting a pension are exempt from income tax. But when any ""taxable component"" is withdrawn by a member, it is included in their income tax return if the member is between 55 to 59 years.
However, combined with salary sacrifice and 15% pension rebate, this strategy can creat amazing results.