The transfer balance cap has required some large SMSFs to transfer pension money back to accumulation, and the two pools must be treated carefully to maintain the full benefits from superannuation.
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A reader thought Noel Whittaker’s article last week reported an ‘incredible’ claim, so more detail is provided on the correct documentation and management of Transfer Balance Caps.
There has been a massive focus on the maximum allowed in a tax-free pension of $1.6 million, but what happens if your portfolio rises in value and you exceed it? Should you worry about it?
The $1.6 million Transfer Balance Cap (TBC) on pension accounts affects only capital balances. It’s not affected by income earned and pensions paid, and there are ways to maximise the remaining tax-free status.
The use of separate SMSFs for accumulation and pensions stages to minimise tax obligations may attract the ire of the ATO, but there may be other, more legitimate, reasons for using this strategy.
Months after the major superannuation reforms of 1 July 2017, advisers and their clients are still asking important questions, especially about transfer balance caps and segregation.
Many people believe it is not possible to hold more than $1.6 million in assets supporting pension accounts, but there’s good news for the reader asking this question.
With super changes a week away, this is the last chance to act on transition to retirement adjustments, resetting CGT cost bases or contributions under the higher limits.
If the sum of a couple’s pension balances is over $1.6 million and a spouse dies, what can the survivor do to keep the assets in the superannuation environment?
A point by point final reminder of actions needed before 30 June on large pension balances, plus good news about the timing to claim CGT relief to reset the cost base to market values.
In addition to the $1.6 million transfer balance cap, SMSF members should also understand the concept of ‘total superannuation balance’ to stay within the rules and make the most of contribution opportunities.
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.
Super fund members should review their estate plans and insurance arrangements in light of the new transfer balance cap rules.
Defined benefit pensions once meant sitting back and enjoying the guaranteed income flow for life, but their treatment under the new pension rules is a potential minefield.
Unless all members of an SMSF or SAF are of the same age and have the same retirement goals, the new super rules look like complicating tax payments when one member is in pension and the other accumulation.
The changes to superannuation rules make rolling over an estate into a surviving spouse’s pension account less attractive, reviving a role for testamentary trusts.