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The Government has not made any major changes to Superannuation in the 2018 budget but there are still some minor tweaks to be aware of:
- 12 Month work test exemption for certain members over 65
- Maximum SMSF Members to be increased from 4 to 6
- Ability for large income earners to elect not to receive SG Contributions
- General Superannuation changes to protect low balance members
Worktest Changes
There will be a one year exemption from the work test for voluntary contributions to super for people aged 65-74 and super balances below $300,000. A member retiring on 1 June 2020 with only $150,000 in super who does not meet the work test could put $45,000 at concessional rates (using the carry forward arrangements) and $100,000 in non-concessionals, almost doubling his super balance after leaving work.This is intended to give retirees flexibility in the transition after work
SMSF Members
The Budget confirms the maximum number of members allowed in an SMSF will rise from four to six to give more flexibility for larger families.
SG Election
People earning more than $263,157 with multiple employers will be able to elect not to receive Superannuation Guarantee Contributions from 1 July 2018. This is to enable members to prevent inadvertently exceeding the $25,000 cap on concessional contributions
Other Superannuation Changes
Inactive accounts below $6,000 will be transferred to the ATO to protect from further erosion
Data matching will be used to connect with the member’s active accounts.
total fees on super accounts of less than $6,000 will be capped at 3%
Exit fees will be banned on all super accounts
They will also make life insurance in superannuation an opt-in for members under 25 or inactive accounts. |
