Contributions pre 30 June, 2018
Concessional contributions cap (deductible)
The maximum contribution for 2018 is $25,000.
Be extra careful with timing cut offs with last years June, 2017 contribution(s), and this years June, 2018 contribution(s).
From 1 July, 2017 the 10% work test has been removed. As such, the concessional (deductible) contribution can be made via salary sacrifice from your employer or can be made personally.
Non-concessional contributions cap (non-deductible)
The maximum non-concessional contribution from 1.07.17 to 30.06.18 is $100,000.
The member needs to be under 65, or meet the work test, and have not already exceed the non-concessional contributions cap via prior year contributions.
It is also important to note that if the member’s combined superannuation balance exceed $1.6m, then the member is not allowed to make any non-concessional contribution, even if they have no TBC yet.
Any non-concessional contribution in this scenario would be subject to excess contributions tax.
Transitional arrangements for 2018
|Total superannuation balance on 30 June 2017||Maximum non-concessional contributions cap for the first year||Bring-forward period|
|Less than $1.4 million||$300,000||3 years|
|$1.4 million to less than $1.5 million||$200,000||2 years|
|$1.5 million to less than $1.6 million||$100,000||No bring-forward period, general non-concessional contributions cap applies|
source ATO Website
Cut off / timing
For those that have checked their calendar, 30 June, 2018 is a Saturday. As such, to ensure that the contribution is received by the Fund trustee before 30 June, it would be prudent to make sure the contribution is made and accepted before Friday 29 June.
Any amounts credited via BPAY or online transfer to the funds bank account after 30 June, 2018 will not deductible, even if transferred pre 30 June. If the ATO become aware of the deduction, it would be denied, with potential for significant penalties and interest.
For those last minute decisions, evidence of a cheque being provided to the Fund trustee, for example on 29 June, 2018 should still allow the tax deduction in 2018 tax year. Make sure you have a signed and stamped letter, and that the cheque is promptly banked as supporting evidence.
|95 or more||14.0%||7.0%||10.5%||14.0%|
Age is either at:
‘Account balance’ means one of the following:
Source: ATO website
Important…New event based reporting – TBAR reporting (more to come in next update)
2018 business and investment entity tax planning checklist here
Andrew and Team
Disclaimer. This publication provides an overview or summary only and it shouldn’t be considered a comprehensive statement on any matter or relied upon as such. The information in this publication does not take into account your objectives, financial situation or needs and so you should consider its appropriateness having regard to these factors before acting on it and obtain financial advice. Any taxation position described in this publication is a general statement and should only be used as a guide. It does not constitute tax advice and is based on current tax laws and our interpretation. Your individual situation may differ and you should seek independent professional tax advice. The rules associated with the super and tax regimes are complex and subject to change and the opportunities and effects will differ depending on your personal circumstances. Whilst we take great care with the accuracy of this information, we cannot be held responsible for any misinterpretation or inaccuracy in the above comments. You may not rely on this and should independent advice prior to taking any action. Laws are subject to change and this summary is current as at 6.06.18.