Last week the highly anticipated legislation to increase super contributions caps and age limits from FY2020/21 was passed by the Senate:
- Concessional contributions caps have been raised from $25,000p.a. to $27,500p.a. from 1 July 2021. Instead of waiting until June 2022 to make your contribution, why not consider making monthly contributions?
- From 1 July 2021, excess concessional contribution charges will be removed, potentially saving between 15% and 94% tax if you have previously exceeded this cap.
- People under the age of 67 on the 1 July 2021 (previously 66) will now be able to access the ‘bring-forward’ rule, rolling three years’ worth of personal contributions into one.
- From 1 July 2021, anyone who applied for one or both of the COVID-19 early super release payments can re-contribute this withdrawal back into their super fund.
- The number of members in a Self Managed Super Fund will increase from 4 to 6 members, potentially paving the way for a greater transfer of inter-generational wealth.
- The temporary reductions in age-based minimum pension drawdowns introduced in FY2020/21 in response to COVID-19 have been extended into FY2021/22.
Please speak to one of our Advisers if you would like a personal analysis on how any of these changes could apply to your situation.