Budget 2015: Superannuation & Pensions

The Government kept its promise to leave superannuation as it, however 91,000 older Australians will no longer qualify for part-pensions.
Asset test changes for part-pensions
Date of effect: From 1 January 2017
Approximately 91,000 part pensioners will no longer qualify for the part pension, following the Government's reaffirmation that it will increase the asset test thresholds and withdrawal rate at which pensions are reduced once the threshold is exceeded. The taper rate will revert back to the pre 2007 level of $3 (from $1.50).
Maximum value of assets changes
The maximum value of assets you can hold to qualify for a part pension will also be reduced. Approximately 91,000 current part pensioners will no longer qualify for the pension and a further 235,000 will have their part pension reduced.
Date of effect: From 1 July 2015
The Government is changing rules for terminally ill people to access their superannuation. Currently, patients must have two medical practitioners (including a specialist) certify that they are likely to die within 1 year to gain unrestricted tax free access to their superannuation balance.
The Government will change this period to 2 years.
Social Security for superannuants
Date of effect: From 1 January 2016
A larger proportion of a superannuant's defined benefit income will be taken into account when applying the relevant social security income test, capping the proportion of income that can be excluded at 10%. A defined benefit income stream is a pension paid from a public sector or other corporate defined benefit superannuation fund where the pension paid generally reflects years of service and the final salary of the beneficiary.
Under current arrangements, some defined benefit superannuants are able to have a large proportion of their super income excluded from the pension income test. Recipients of Veterans' Affairs pensions and/or defined benefit income streams paid by military superannuation funds are exempt from this measure.
More from the 2015 Budget:
- The "Have a Go" Budget
- Small Business Package
- Business in General
- International tax changes
- Families & Individuals
- Tax Compliance
- Economy in Brief
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Disclaimer
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.
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