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6 changes to superannuation policies you need to know

The Federal Government has recently outlined six significant changes to superannuation policies in their Federal Budget that business owners will need to be aware of going into the 2021 financial year. Ashfords' superannuation experts have highlighted these changes for your convenience.

    1.  6 Member SMSFs

    From the 1st of July 2021, Self Managed Super Funds will now be allowed to have up to 6 members.

    2. Super Contribution Limits increase.

    Superannuation concessional and non-concessional contribution caps will be indexed from 1st of July 2021. The new caps will be $27,500 for concessional contributions and $110,000 for non concessional contributions or $330,000 using the3-year bring forward rule. 


    Contribution Caps (annual)
    All ages 17/18 - 20/21 21/22
    Concessional contribution (CC) cap $25,000 $27,500
    Non concessional contribution (NCC) cap $100,000 $110,000








    3. Superannuation Guarantee Charge increased.

    From the 1st of July 2021, the super guarantee rate will rise from 9.5% to 10%

    4. Transfer Balance Cap indexed to $1.7 million.

    The general transfer balance cap was $1.6 million. From the 1st of July 2021, It will be indexed to $1.7 million. When the general transfer balance cap is indexed to $1.7 million, there won't be a single cap that applies to all individuals. Every individual will have their own 'personal transfer balance cap' of between $1.6 and $1.7 million.

    5. Bring forward contributions cap.

    The cut-off age for accessing the bring forward non-concessional cap will increase from 65 to 67 years. This now aligns with the 'Work Test' now required at age 67. This means that individuals aged 65 and 66 who were not previously able to access the bring forward cap due to their age may not do so.

    6. Minimum pension reduction due to Covid-19.

     Account based pension minimum withdrawals reduced by 50% in 2021/22 financial year due to the impact of Covid-19

    Age 

    2021-22 income year


    under 65
    2%
    65-74 2.5%
    75-79 3%
    80-84 3.5%
    85-89 4.5%
    90-94 5.5%
    95 or more 7%


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    This is general information only and does not take into account your personal objectives or circumstances. Please contact Ashfords and talk to one of our Superannuation Specialists before acting on any of this information, we can provide personalised advice. 

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