With the end of another financial year only a few weeks away we have listed some key actions to consider. If you would like to discuss any of these points please give us a call.
All contributions (employer, personal or self-employed) must be deposited and banked to the receiving super fund no later than Friday, 28th June 2013. The relevant limits for the financial year ending 30 June 2013 are:
- Concessional contributions (pre-tax / tax deductible)
- $25,000 for all individuals.
- Non-concessional contributions (post tax)
- $150,000 per individual; or
- $450,000 in a 3-year period if aged <65.
Reduced Tax Concession for Higher Earners Confirmed
The Government has confirmed its intention to proceed with the changes announced in the 2012 Federal Budget to increase the concessional contribution tax rate from 15% currently to 30% for individuals with income >$300,000. This measure is to take effect from 1 July 2012 but is still to be legislated.
Superannuation Pension Withdrawals
If you have a self managed superannuation fund in pension phase it is important to ensure you have withdrawn your minimum pension before 30 June 2013. Failure to do so can result in the fund incurring additional tax expense on investment income. Please check with us if you are unsure.
For the financial year 2012/13 the maximum co-contribution provided by the Government is $500 for individuals with taxable income up to $31,920. Individuals with taxable income up to $61,920* may still qualify for a part-payment.
* This may reduce to $46,920 from 1 July 2012 if proposed legislation is passed.
If your spouse has assessable income less than $10,800 and you make a post-tax contribution to their superannuation account on their behalf, you will receive a tax offset of 18% of the contribution value up to a maximum offset of $540 (i.e. maximum spouse contribution of $3,000).
Prepaying interest in advance can be an effective way to secure a lower rate of interest and gain cashflow certainty for the fixed period. Where the loan has been drawn for investment purposes there may be the added benefit of bringing forward up to 12 months of tax deductible interest payments into the current financial year.
Increase in Super Guarantee
Effective 1 July 13 the super guarantee increases from 9% to 9.25% and then rises progressively to 12% by July 2019.