The Federal Parliament has recently passed the Treasury Laws Amendment (Enhancing Superannuation Outcomes for Australians and Helping Australian Businesses Invest) Bill 2021. From 1 July 2022, there are changes coming to the Australian Superannuation system which may impact you.
To keep on top of the changes, it is a good idea to reach out to a trusted Financial Advisor from Endorphin Wealth. You don’t want to miss out on some of these!
What are the changes?
The Federal Government proposed some changes in the May 2021 Federal Budget. Effective from 1 July 2022, legislation will look to implement the following changes:
- Partially removing the work test for those aged 67 to 75.
- Extending the non-concessional contributions bring-forward age limit to age 75.
- Reducing the downsizer contribution eligibility age.
- Increasing the maximum First Home Super Saver Scheme withdrawal amount to $50,000.
- Removing the monthly minimum threshold for Superannuation Guarantee (SG) Contributions.
Please note that some of these amendments will also require supporting regulations to become effective. These regulations are yet to be introduced.
Partially removing the work test
The existing work test or the ‘work test exemption for recent retirees’ will no longer be required for individuals aged 67 to 75. This is for those who make and or receive salary sacrifice or non-concessional contributions (NCCs).
Some rules still apply for certain individuals surrounding work testing. It is important to reach out to a financial advisor to see if this applies to your situation.
Extending the non-concessional contributions bring-forward age limit
The cut-off age for accessing the NCCs bring-forward rule will be increased from 67 to 75 years. Many individuals aged 67 to 74 years who were not previously able to bring forward NCCs cap amounts, could potentially do so in the coming financial year.
Reducing the eligibility age for downsizer contributions
Individuals aged 60 or older a can now make downsizer contributions from the start of the next financial year. Other downsizer contribution rules still apply.
Increasing the maximum First Home Super Saver Scheme withdrawal amount
The maximum FHSSS withdrawal amount will be increased from the current limit of $30,000 to $50,000. This could be a great booster for first home buyers to get their foot into the property market.
Removing the minimum monthly threshold for SG contributions
There will no longer be a minimum monthly threshold for an eligible employee to qualify for SG contributions. Even where an eligible employee earns less than $450 in a calendar month, there is now an obligation for the employer to make SG contributions.
Need More Information?
As always, it is important to take your personal situation into account. Endorphin Wealth is able to create personalised strategies taking into account your situation and needs.
For an obligation-free conversation about your financial future, please contact us on 03 9190 8964 or at email@example.com.
The team at Endorphin Wealth are passionate about helping people achieve their life goals with great financial planning. We are not licensed or owned by big banks and financial institutions. So the advice and wealth management we provide is always in our client’s best interests. We have the advantage of being able to access a range of products from different providers. This means that our advice can be tailored to our client’s goals. We have offices located in Sydney and Melbourne, where you can find a financial advisor that is suitable for you.
If you want to take advantage of the latest changes to superannuation, reach out to us here at Endorphin Wealth.