Several legislative changes which could impact on your personal circumstances are scheduled for 2012. To ensure your savings plans are appropriate and compliant with Government requirements speak with Andrew Frith of Self Managed Super Specialists.
Reduction in concessional contribution cap.
The concessional contribution cap for superannuation fund members aged 50 or over is scheduled to reduce from $50,000 pa to $25,000 pa on 1 July 2012. The Government has been looking at ways for people in the 50+ age group to make higher contributions than the $25,000; however, as there is no legislation at this stage take advantage of the $50,000 contribution cap before 30 June.
Low income superannuation contributions
Taxpayers with an adjusted taxable income of up to $37,000 pa will receive a low income superannuation contribution up to a maximum of $500 from 1 July 2012. This effectively means that the 15% contributions tax payable by low income earners is refunded.
Government co-contributions to reduce
1 July 2012 will see the reduction in the government's co-contribution from $1,000 to $500, with the cut-off threshold falling from $61,920 to $46,920. You need to consider making additional contributions to your super. Contact Andrew Frith of the Self-Managed Super Specialists for assistance in reviewing your retirement savings plans and ensuring you are compliant with legislative requirements.
No change in minimum pension payments
The Government announced that the minimum pension payments will continue for another 12 months. This benefits pensioners and people with a transition to retirement pension (TTR) wanting to maximise their investments in their pension accounts and hopefully participate in any market recovery.
Carbon tax – Government's payments
The Government has indicated that a range of payments and some supplements will be made, commencing in May or June 2012.
In addition, from 1 July 2012:
- the maximum taxable income that can be received tax-free from a superannuation pension by people aged 55-59 will increase by approximately $1,500 to $49,753 pa
- the effective tax-free threshold on ordinary (non-pension) income will increase from $16,000 to $20,542 pa.
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