Don’t be caught out.
With the new Financial Year nearly upon us, so too are a few changes to superannuation that you should keep in mind. This is especially true for businesses, as you don’t want to be caught out.
Superannuation Guarantee Contribution Increase
From 1 July 2021, the compulsory Superannuation Guarantee Contribution (SGC) will increase from 9.5% to 10%.
Great news for those saving for retirement, however someone has to pay for it. For those whose salary package is ‘plus super’ employers will foot the bill. For those whose salary is inclusive of super however, you will see a reduction in your take home salary.
Super Contribution Caps
For the first time since their introduction, contribution caps will be increased.
|Contribution Cap Type||Pre 30/06/2021||Post 01/07/2021|
The changes in the contribution cap amounts will also affect the amount you can bring forward for the three year bring forward rule and the amounts rolled forward under the carry – forward concessional contribution rules.
Bring Forward rule extended to clients under 67
This extends the three year non-concessional contribution bring forward rule to individuals under age 67. It is due to commence on 1 July 2021, however this change will be implemented retrospectively from 1 July 2020. What this means is that you can bring forward up to three years of non-concessional contributions. This maybe useful for those who come into lumps sums of money such as an inheritance.
Single default fund
To address individuals accumulating multiple superannuation funds over their working life, this change will see the creation of a “stapled fund.” Employers will be required to pay to your stapled fund unless you expressly inform them otherwise.
Employers will obtain information about the employee’s existing superannuation fund from the Australian Taxation Office if it is not provided by the employee. This will come into force for employees who start a new job on or after 1 November 2021.
Should you feel any of these changes may apply to you and wish to discuss them further, contact us to schedule a no-obligation Discovery Meeting with Louella Jorge.
The views expressed in this publication are solely those of the author; they are not reflective or indicative of RI Advice Group’s position and are not to be attributed to RI Advice Group. They cannot be reproduced in any form without the express written consent of the author. Louella Jorge is an Authorised Representative of RI Advice Group Pty Ltd, ABN 23 001 774 125 AFSL 238429. This editorial does not consider your personal circumstances and is general advice only. It has been prepared without taking into account any of your individual objectives, financial solutions or needs. Before acting on this information, you should consider its appropriateness, having regard to your own objectives, financial situation and needs. You should read the relevant Product Disclosure Statements and seek personal advice from a qualified financial adviser before you act