Reminder: super changes for the 2021 financial year

Reminder: Super Changes For The 2021 Financial Year

The government’s long-slated “flexibility in superannuation” legislation is finally law.

This means from 1 July 2021, individuals aged 65 and 66 can now access the bring-forward arrangement in relation to non-concessional super contributions. The excess contributions charge will be removed for anyone who exceeds their concessional contributions cap, and individuals who received a COVID-19 super early release amount can now recontribute it without hitting their non-concessional cap.

Previously, if you made super contributions above the annual non-concessional contributions cap, you could automatically access future year caps if you were under 65 at any time in the financial year.

The bring-forward arrangement allows you to make non-concessional contributions of up to three times the annual non-concessional contributions cap in that financial year. Note for the 2021 income year, the non-concessional contribution cap limit was $110,000.

In addition, individuals who previously exceeded their concessional contributions cap would have to pay the excess contributions charge (around 3%) as well as the additional tax due when excess contributions were re-included in their assessable income.

However, people who exceed their cap on or after 1 July 2021 will no longer pay the charge, but will still receive a determination and be taxed at their marginal tax rate on any excess concessional contributions amount, less a 15% tax offset to account for the contributions tax already paid by their super fund.

Shaun
W MARSHALL & ASSOCIATES

https://www.marshals.com.au/

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First and foremost, we’re accountants. But we like to think of ourselves as a lot more. We work closely alongside business owners to bring more clarity, direction, and support, improving elements of your life beyond just the business. And, with our firm’s history in the Townsville area going back to the 1950s, we’re an established part of the local business community. We take that responsibility seriously.

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