As we inch closer to this year’s federal election, there was always a sense of urgency around the finalisation of key superannuation measures announced in the 2021/22 federal budget.
With a limited number of sitting days available, we have seen the Treasury Laws Amendment (Enhancing Superannuation Outcomes For Australians and Helping Australian Businesses Invest) Bill 2021 make it’s way through both houses without amendment. The outcome of the finalise bill:
- amends the Superannuation Guarantee (Administration) Act 1992 to remove the $450-a-month threshold before an employee’s salary or wages count towards the superannuation guarantee;
- amends the Taxation Administration Act 1953 to increase the limit on the maximum amount of voluntary contributions made over multiple financial years that are eligible to be released under the First Home Super Saver Scheme from $30 000 to $50 000
- amends the Income Tax Assessment Act 1997 to: enable individuals aged 60 and above to make downsizer contributions to their superannuation plan from the proceeds of selling their home
- will only apply the work test to individuals aged between 67 and 75 who claim a deduction for personal superannuation contributions. This change will allow these individuals to make or receive non-concessional contributions (NCCs), without the need for the work test, including under the bring forward rule; and
- enable trustees to choose their preferred method of calculating exempt current pension income (ECPI) when they have member interests in both accumulation and retirement phases for part, but not all, of the income year.
The above measures have a 1 July 2022 start date, with the exception of the ECPI choice laws, which apply for the 2021-22 SMSF income return (i.e. 1 July 2021 start date).
For SMSFs specifically, we did not see the proposed residency and legacy pension conversions move from the initial budget announcement. It appears likely that the Coalition will remain committed to these measures within this year’s federal budget to be held on 29 March 2022, before things swing into election mode. At this time, it is unsure whether Labor would even be remotely interested in making these changes should they form Government.