When changes to regulations are as extensive and complex as the coming 1 July rules, many misconceptions about how they work arise for both advisers and their clients. Here are a few common mistakes.
Author Archive | Graeme Colley
A positive development from recent super changes is the lifting of current restrictions on claiming tax deductions for personal super contributions and a flexible carry-forward rule.
A unique feature of SMSFs is the concept of ‘superannuation interests’ which must be monitored to keep track of the taxable components in a super fund. Good records can avoid problems later.
Graeme Colley answers a reader’s question on making non-concessional contributions to super after the age of 65, including how the contributions caps work in different situations and how to make the most of them.
It’s popular to argue that the contribution caps are severe limits to the amount placed in super. But a couple can put up to $1.5 million into super in the next few months, so make the caps work in your favour.
Contribution splitting allows a super member to split up to 85% of concessional contributions received in a financial year with their spouse, and there are times when this is a good strategy.
The main benefit of a Transition to Retirement (TTR) pension when under age 60 is not the cash flow from the pension, but income earned in the fund on the investments supporting the TTR pension is tax free.
Whether a reversionary or non-reversionary pension is better is not straightforward and depends on the circumstances of the case, but it’s an important part of estate planning.
Technical but important – recent amendments allow the income on investments supporting a non-reversionary pension to continue as exempt current pension income after the death of the member.
Research now backs up the anecdotal claims that SMSF trustee confidence in the superannuation system is declining. The proposed Council with its independence and long term view will help address this.