New concessional contribution limit

The super changes first announced in this year’s Budget were passed by the Senate on Wednesday 23rd November. With that we will now have a much lower concessional (deductible) contribution limit from July next year.

The limit for the current 2016/17 financial year is $35,000 per annum for those aged 49 or older on 30^th June 2016; $30,000 for those younger.  The limit for everyone will fall to $25,000 as from the 2017/18 year.  And with the non-concessional limit then also falling to $100,000 (subject to transitional and bring forward rules), many people will have to re-calculate how they are going to accumulate sufficient capital upon which they can retire.  Long gone are the days when one could rectify years of no planning for retirement by making concessional contributions of around $100,000 over a few years.  Retirement planning need to now start at an earlier age.

Thankfully one of the positive changes ignore by the press is one that allows those that have been out of the work force for an extended period to make catch up on contributions in excess of the annual limit. They 10% employment income test will also be removed.  It’s not all bad news.

At MRS, we will spend today planning for your success tomorrow.

At MRS, we will spend today planning for your success.