Article published by RJS Wealth Management Pty Ltd
A concessional contribution is a before-tax superannuation (super) contribution which includes both salary sacrificed and employer superannuation guarantee contributions. Or for the self-employed or not employed, it is a tax-deductible super contribution.
In previous years, individuals were able to contribute $30,000 (aged 48 and under) or $35,000 (aged 49 and over) per annum. From 1 July 2017, these concessional contribution caps will reduce to $25,000 per annum for all age groups, indexed in $2500 increments per annum.
From July 2018, those who have a super balance of less than $500,000 are able to carry forward any unused portion (the difference between the contribution made to super in the financial year and the $25,000 cap) of your concessional contributions cap for up to 5 years.
How are defined benefit funds effected?
The amount of “notional taxed contributions” for a financial year counts towards the person’s concessional contributions cap. Other contributions made to the funded defined benefit fund that are not included in notional taxed contributions do not count towards the person’s concessional cap.
Superannuation can be complicated. To find out how these and other superannuation reforms affect you, what action you should take or to simply ask a question, contact an RJS Wealth Management Professional on 1300 256 526. In many circumstances, it may be ideal to take action now.
Source: SuperGuide.com.au, MLC
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