Chloe Ward chats about the budget, non-concessional contribution caps and wraps up the month as we all prepare for the election that is just around the corner.
Effective from July 1, 2017, the government intends to place a $1.6 million cap on the amount of superannuation that you can retain in, or transfer to, a super pension account. The government released an exposure draft of the proposed legislation for this measure on 27 September 2016. Final legislation is expected to be passed before the end of 2016. This proposed budget change capping pension balances (and therefore limiting the corresponding tax exemption available) to $1.6 million has caused major concern to impacted SMSF trustees – but it may not be all bad news!
The Changes Explained
There are 5 areas in which the new changes impact.
1. Cap on tax-free super accounts
Currently: No limit on the amount of money in superannuation that is tax-free in retirement mode.
Proposed: From July 1, 2017, a limit of $1.6 million can be transferred into a tax-free super account.
Do you want to make your life easier, your superfund compliance easier and of course help make the administration of your superfund easier?
We go on and on about data feeds and the important role they play in your superfund’s administration and we are now finally starting to see this also flow across to the audit of superfunds.
Less paperwork
How would you like to travel around and get on with life, not having to worry about being home or having internet access to be able to provide us with documentation for the completion and audit of your superfund accounts? This is finally possible!
Software company, Class Super, has spent plenty of time and resources into auditing the data feeds they receive so that other independent auditors can place more reliance on this data. This is fantastic news, as this has a flow on effect to you all as clients.
What exactly is Class Super?
Class Super Pty Ltd (Class) is used by Superfund Partners to prepare your SMSF accounts.
I was interested but not necessarily surprised to read two articles this week relating to financial fortunes of the general Australian population. The first article talked about financial literacy, where a study by Zurich and Oxford University found that Australia ranked near the bottom of the tables. In the second article, a study by the Actuaries Institute found that almost a third of Australians are in danger of running out of money because they are drawing too much out of superannuation.
With the percentage of Australians that do not currently seek any ongoing financial advice sitting at close to 80%, these reports should not be surprising to anyone. The risk of not achieving any long term goal without some form of coaching, mentoring or external direction is extremely high and it makes sense that those with a trainer, coach or in this case an adviser, have a far better chance of maintaining discipline and achieving their goals.
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