By Mark McNeany
With concessional superannuation contribution changes now in play, we thought you should know so you can plan ahead and see how they could work for you. From 1 July 2018 you can carry forward any unused amount of your $25,000 concessional superannuation contributions cap. The unused amounts can be carried forward on a rolling basis for 5 years. From 1 July 2019, providing your total super balance at 30 June of the previous year is less than $500,000, you can make use of your unused concessional contributions in addition to the standard concessional contribution cap of $25,000.
For example, Mr Client received $15,000 of employer contributions in the 2018/19 financial year and makes no additional concessional contributions. Mr Client therefore has $10,000 of unused concessional contribution cap in the 2018/19 financial year which can be carried forward for 5 years. In the 2019/20 financial year Mr Client can make total concessional contributions of $35,000. This is made up of the annual concessional contribution cap of $25,000 for 2019/20 plus the $10,000 of unused concessional contributions cap from the 2018/19 financial year. The good thing is that any additional concessional contributions you make out of your own savings can be claimed as a tax deduction.
This could be especially helpful if you are planning on selling a large investment asset such as a property or shares and you want to reduce your capital gains tax.
So if you find yourself with unused concessional contributions, with good planning you can boost your super and reduce tax. .
Feel free to contact us to discuss your position and needs further.
General Advice Warning:
Any advice in this email is of a general nature only and has not been tailored to your personal circumstances. Before acting on this advice, you should consider whether it is appropriate having regards to your personal objectives, financial situation and needs.
The information in this document reflects our understanding of existing legislation, proposed legislation, rulings etc as at the date of issue. In some cases the information has been provided to us by third parties. While it is believed the information is accurate and reliable, this is not guaranteed in any way.