SUPERCentral is an independent online platform provider of SMSFs, advice, legal documentation and wealth management services to accounting and financial planning firms throughout Australia.
Super changes now before Parliament
Most of the superannuation changes announced in the 2021 May Federal Budget are now before Parliament as Treasury Laws Amendment (Enhancing Superannuation Outcomes for Australians and Helping Australian Businesses Invest) Bill 2021 (yes - that is its official title!).
The changes will generally apply to the 2022/23 and subsequent financial years. The changes not included in the Bill are those dealing with legacy product conversions and the pension loans scheme. Presumably, these changes will be included in separate Bills which are yet to be released.
Generally, all the changes in the Bill are favourable and there seems to be little chance of the changes not being passed.
In brief, the changes are:
- removal of the $450 monthly threshold for compulsory employer superannuation contributions;
- increasing the cap on the amount of contributions which can participate in the First Home Super Saver Scheme to $50,000 (currently the cap is $30,000);
- reducing the minimum age at which downsizer contributions can be made by or for you to age 60 (currently the minimum age is 65);
- removing the work test for individuals aged 67 to 74 from non-concessional contributions or salary sacrifice contributions;
- permitting individuals aged 67 to 74 to make “bring forward contributions”; and
- simplifying the calculation of exempt income when a superannuation fund is in retirement phase.
The Bill will also extend to the 2022/23 financial year the temporary relief for full expensing of certain depreciating assets. However, as this measure does not affect superannuation, it will not be considered in SUPERCentral News.
The proposed changes to the "bring forward contributions" and the simplification of the exempt pension income calculation will be considered in the next issue of SC News. The other superannuation changes are considered in the next articles.