At Last Your Past Can Catch Up With You

Another fantastic super change came into effect from the 1st July 2019.

To explain how, let’s have a quick recap of concessional super contributions.

A concessional contribution is paid from your before-tax income and can come from employer contributions, salary sacrificing or your own tax-deductible contributions. Concessional contributions are the main part of most people’s super savings and are usually taxed at 15%. From the 2017/18 financial year, you’ve been allowed to make $25,000 per year in concessional tax contributions. Anything above that is taxed at your marginal tax rate.

Previously, the ATO never allowed you to carry over any shortfalls. That’s now changed. If you spend under the cap, you can carry over that difference to make a higher contribution for up to 5 years into the future.

Why does this matter?

For many of us, our income fluctuates. This is particularly the case if you’re self-employed, but even otherwise, maternity leave, bonuses, travel, varying shifts and unemployment can all affect your annual pay and the amount you have available to contribute to your superannuation. The recent change to the law allows you to take advantage of those leaner years and contribute more when your income returns to normal. It’s a fairer system and we encourage you to optimise your super payments in response.

What to do next

Consider both salary sacrificing and making personal deductible contributions to take advantage of the scheme. We can advise you on the best approach based on your current cashflow needs and retirement goals.

Call John Sciacca today for a no-obligation consultation on 07 3357 5553 or email

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