The current Government has proposed a number of changes to Superannuation over the last year and the following have now become law having recently received royal assent.
The concessional contribution cap has increased from $25,000 to $35,000 for those aged 59 and over on 30th June 2013 and over 49 on 30th June 2014. Good news for older Australians who want to increase superannuation contributions tax effectively as they move closer to retirement.
Not so good is the reduction in the superannuation tax concession on concessional contributions from 30% to 15% for people who earn $300,000pa or over, including defined benefit members. This change will affect a number of Doctors and reduce the tax effectiveness of their concessional superannuation contributions.
Finally, the superannuation co-contribution maximum payment has been reduced from $1,000 to $500 with a reduction in the taper rate from $1 to 50c and a reduction in the income cut-off threshold from $61,920 to $46,920.
The reduction in the superannuation tax concession and co-contribution rates are effective from 1st July 2012 so Doctors who earn over $300,000 should expect an additional tax liability for the 2012/13 financial year.
If you would like to understand any of these changes in more detail please don’t hesitate to contact Medical Financial Planning.
|Tags: News Tax Wealth Creation|
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