Superannuation contribution caps increase
The concessional cap - or salary sacrificing cap - for superannuation is set to increase to $30,000 from 1 July 2014. It is the first increase in five years, and if you're over the age of 49, then the limit is now $35,000. The increase is good news for people who need to top up their balances as they get closer to retirement.
So what's changing?
A concessional contribution is a contribution made to your super before tax, which can include salary sacrifice arrangements with your employer or tax-deductible contributions made by an individual. With a 15% tax rate, it's a powerful way to save for retirement, when compared to the typical marginal tax rate.
The table below shows the changes for each age group:
The change in the concessional cap will start from 1st July 2014.
Non-concessional contributions are "after tax" contributions and for the 2014/15 tax year, the cap has increased to $180,000 - an increase of $30,000 compared to the 2013/14 tax year.
The change in the non-concessional cap will start from 1st July 2014.
It's important to ensure you watch your contribution limits and timing. Any contributions before or up to June 30 are subject to the 2013/14 caps.
For more information about concessional contributions to your super, please contact us on 02 9957 4033 or via our contact form.
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Last updated April 2014. This article is provided for information purposes only and should not be used in place of advice from your accountant. Please contact us on 02 9957 4033 to discuss your specific circumstances.
This article is provided for information purposes only and correct at the time of publication. It should not be used in place of advice from your accountant. Please contact us on 02 9957 4033 to discuss your specific circumstances.