The rules for super contributions might be changing soon, but here’s how much you can contribute this year
Here are the superannuation contribution caps which currently apply for the 2015/16 financial year.
• Contributions which qualify for a tax deduction
These are known as concessional contributions and the limit is aged based, as shown below. Generally you can only qualify for a tax deduction if you are self-employed.
However employees can benefit as well by making a contribution through salary sacrifice.
The limit includes any Super Guarantee your employer pays on your behalf.
Age Tax deductible limit (2015/16)
Up to 49 $30,000
• Contributions which do not qualify for a tax deduction
The current legislated maximum you can invest in super as a personal after-tax contribution is $180,000 p.a. (called a ‘non-concessional’ contribution). If you are under age 65, you have also been able to ‘bring forward’ up to two years of non-concessional contributions.
This means you could contribute $540,000 in one financial year, but you would not be allowed to make non-concessional contributions in the following two financial years.
However, a proposal from the 2016 Federal Budget is to replace the current non-concessional caps mentioned above with a $500,000 lifetime limit with a start-date of 3 May 2016 that would include previous non-concessional contributions made back to 1 July 2007.
This measure would only be effective if the Coalition is elected and the measure is passed by the Senate.
To ensure you don’t inadvertently exceed your contributions limit, always speak to your adviser about your superannuation contribution options.
• The Government co-contribution
Currently, eligible workers earning up to $50,454 who make personal contributions to super can take advantage of the Government co-contribution of up to $500.
• Spouse contributions
If your partner’s income is less than $13,800, you could qualify for a tax offset of up to $540 on the first $3,000 you contribute to superannuation for them from your after-tax income. This tax offset decreases as your partner’s income increases above $10,800.
Disclaimer: This article is not legal advice and should not be relied on as such. Any advice in this document is general advice only and does not take into account the objectives, financial situation or needs of any particular person. You should obtain financial advice relevant to your circumstances before making investment decisions. Where a particular financial product is mentioned you should consider the Product Disclosure Statement before making any decisions in relation to the product. Whilst every care has been taken in the preparation of this information, Australian Unity Personal Financial Services Ltd does not guarantee the accuracy or completeness of the information. Australian Unity Personal Financial Services Ltd does not guarantee any particular outcome or future performance. Australian Unity Personal Financial Services Ltd is a registered tax (financial) adviser. Any views expressed are those of the author and do not represent the views of Australian Unity Personal Financial Services Ltd. If you intend to rely on any tax advice in this document you should seek advice from a tax professional. Australian Unity Personal Financial Services Ltd ABN 26 098 725 145, AFSL & Australian Credit Licence No. 234459, 114 Albert Road, South Melbourne, VIC 3205. This document produced in May 2016. © Copyright 2016