We highlighted in a previous column the changes to the after-tax (non-concessional) contribution caps that will take effect in the new financial year. These changes were passed through both houses of Parliament on Wednesday 23 November 2016 as a result of the Federal Government’s superannuation reforms, and also apply to before-tax contribution caps.
From 1 July 2017, before-tax (concessional) contributions will be limited to $25,000 a year for anyone of any age, reduced from the current $30,000 limit or $35,000 limit if you are 49 and over. It is envisaged these changes will make the superannuation system more sustainable for all Australians.
It’s another considerable reduction to the contribution caps that will impact your super balance. Luckily, there’s still time to take advantage of the current legislated caps and contribute up to $35,000 if you are over 49, or $30,000 if you are under.
Your before-tax contributions are contributions made into your super fund before tax has been paid. These primarily include:
- Employer contributions including salary sacrifice payments, and
- Contributions allowed as an income tax deduction.
If you’re in a position to take advantage of the current before-tax cap, it may be wise to seek the advice of a Financial Planner to ensure it aligns with your current financial goals.
Our Financial Planner1 is available to discuss and determine if you have a need for personal advice, without any obligation. A quote will be provided for your approval to proceed. Call 1300 131 293 to find out more.
AustSafe Super is the industry super fund for rural and regional Australia, and has been committed to looking after members’ super throughout their working life, and into retirement for over 25 years.
