New rules have recently created potential opportunities to consider for the 2018/19 financial year.
1. Buying your first home?
From 1 July this year, eligible first home buyers can withdraw voluntary contributions made after 1 July 2017 to their superannuation fund to purchase a first home under the First Home Super Saver Scheme (FHSSS). The FHSSS allows eligible first home buyers to save their deposit in the concessionally taxed super environment.
2. Selling your home?
Eligible super members can make super contributions of up to $300,000 per person from the sale of their home after 1 July this year, if they are aged 65 or over and meet other conditions. These contributions don’t count towards the concessional and non-concessional contribution caps and can be made even if the member doesn’t meet the usual age, work and other contribution tests.
3. Eligible for a tax cut?
The tax cuts announced in this year’s Federal Budget have been legislated. The first tranche took effect on 1 July this year, providing savings of up to $530 – see table below. There are a number of things that could be done with the extra cash, such as paying off debt and making extra super contributions (see opportunity 4).
4. Want a super deduction?
From 1 July 2017, most people (including employees for the first time) are eligible to claim personal super contributions as a tax deduction. This could reduce taxable income and give super savings a much-needed boost.
5. Not likely to max out your super cap?
If super members make concessional (pre-tax) super contributions of less than the cap of $25,000 in 2018/19, they may be able to carry forward unused cap amounts, for use in a future financial year. This is worth keeping in mind – particularly for members who take time off work or work part-time. It means members may be able to make ‘catch-up’ concessional contributions from 1 July 2019, if their cashflow allows. Concessional contributions include all employer contributions (super guarantee and salary sacrifice), personal contributions claimed as a tax deduction and certain other amounts.
We can help assess whether any of these potential opportunities suit your needs and situation and make suitable adjustments to your financial plans.
This information is current as at 23/07/18. This article has been prepared by Heart1Stop, a social media brand owned by Heart Mortgage Services and Heart Financial Advisers. The information contained in this article is an overview or summary only and it should not be considered a comprehensive statement on any matter nor relied upon as such. The views expressed here are not those of Heart1stop, Heart Mortgage Services, Heart Financial Advisers, shareholders, directors or staff and associated contractors and business associates. This article has been prepared without taking into account any person’s objectives, financial situation or needs. Because of this, you should, before acting on any information contained in this article, consider its appropriateness, having regard to your objectives, financial situation or needs. Any taxation information contained in this article is a general statement and should only be used as a guide. It does not constitute taxation advice and is based on current laws and their interpretation. Each individual’s situation may differ, and you should seek independent professional taxation advice on any taxation matters. While the information contained in this article may contain or be based on information obtained from sources believed to be reliable, it may not have been independently verified. Where information contained in this publication contains material provided directly by third parties it is given in good faith and has been derived from sources believed to be accurate at its issue date. It is not the intention of Heart1Stop or Heart Mortgage Services and Heart Financial Advisers that this publication be used as the primary source of readers’ information but as an adjunct to their own resources and training. To the maximum extent permitted by law: no guarantee, representation or warranty is given that any information or advice in this publication is complete, accurate, up to date or fit for any purpose; and no party of Heart1Stop or associated entities as mentioned is in any way liable to you (including for negligence) in respect of any reliance upon such information. This article may also contain links to websites operated by third parties ("Third Parties") who are not related to Heart1Stop. These links are provided for convenience only and do not represent any endorsement or approval by us.