The biggest change is the complete scrapping of the controversial $500,000 Lifetime Cap on non-concessional amounts. <\/p>\n
The government has been under intense pressure since the lifetime cap was announced, due to the harsh and retrospective nature of potentially including all contributions from 1 July 2007. It angered many voters and politicians on both sides of parliament.<\/p>\n
In its place, the government has reverted to the existing system \u2013 an annual non-concessional cap \u2013 but only if superannuation entitlements are less than the magic $1.6m threshold. No non-concessional contributions will be able to be made if your superannuation entitlement exceeds this threshold.<\/p>\n
Intriguingly despite this threshold, the government has proposed to reduce the annual cap from $180,000 to $100,000.<\/p>\n
The \u2018three year bring forward\u2019 system will also remain.<\/p>\n
Work test for over 65s: Re-introduced<\/strong><\/p>\n In an apparent trade off, the work test for those aged 65 to 75 will continue to apply. This is surprising in light of last week\u2019s release of Bills and explanatory material by the government to remove this requirement.<\/p>\n \u2018Catch up\u2019 concessional contributions: Delayed<\/strong><\/p>\n The best superannuation reform in the Federal Budget was for unused contribution caps to be carried forward on a five year rolling system. This allowed those with interrupted work patterns, or lumpy annual incomes to be able to catch up super. It was a policy that really worked for those on parental leave, changing careers, or with variable incomes.<\/p>\n Now, this policy will be delayed by 12 months.<\/p>\n An opportunity?<\/strong><\/p>\n The removal of the lifetime cap is a trigger for all taxpayers to reassess their super contributions.<\/p>\n None of the changes will apply until at least 1 July 2017, so the current rules are back in play. Accordingly, the annual non-concessional cap remains at $180,000 p.a., together with the concessional cap of $30,000 or $35,000 (depending on age).<\/p>\n Further, for those under 65, it remains possible to take advantage of the three year bring forward system to increase superannuation contributions up to $540,000 for the last time this year.<\/p>\n Should you have any queries, or would like to discuss how this applies to your specific circumstances, please do not hesitate to contact us.<\/p>\n","protected":false},"excerpt":{"rendered":" The biggest change is the complete scrapping of the controversial $500,000 Lifetime Cap on non-concessional amounts. The government has been under intense pressure since the lifetime cap was announced, due to the harsh and retrospective nature of potentially including all contributions from 1 July 2007. It angered many voters and politicians on both sides of…<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[6],"tags":[],"class_list":["post-13943","post","type-post","status-publish","format-standard","hentry","category-news"],"yoast_head":"\n