Last year, the government proposed a series of wide ranging reforms to Australia’s superannuation system, representing the most significant changes to super in a decade. Although not all the proposals have been legislated, some significant ones have already.
We recognise that keeping up with the superannuation rules and regulations can be a minefield. It’s important to understand the changes and how they may affect your financial strategy. That’s where Bentleys and the Superannuation team can support you.
Superannuation Changes | Family Business Accoutnants | WestcourtCraig Seddon
- The annual before-tax contribution caps for concessional contributions to superannuation are $25,000 for those under age 49 and $30,000 for those over age 49.
- The tax on concessional contributions within the cap is 15% for those with income under $250,000 and increases to 30% for income over $300,000 from July 1, 2017.
- There are also proposed reforms to non-concessional contribution caps, spouse contribution caps and offsets, and superannuation pension limits.
The document provides an overview of financial planning, including the financial planning process, goals, and strategies. It discusses analyzing current financial resources and priorities, developing a personalized plan, implementing recommendations, and keeping the plan updated. It also addresses organizing personal finances through a net worth statement and budget, ways to increase net worth, and the impact of taxes on investments. The overall document serves as an introduction to financial planning concepts.
The document summarizes the Florida state deferred compensation retirement program. It provides three key components to preparing for retirement: the Florida Retirement System pension or investment plan, supplemental savings like deferred compensation or IRAs, and Social Security benefits. It describes how deferred compensation works by allowing pre-tax contributions and growth over time. It lists investment providers and contribution limits and benefits of the program like tax deferral and flexibility.
Super Caps are coming soon, great investment alternatives are already here. Sarah McGavin
View our presentation on how an investment bond can help you grow your clients’ wealth and be a complement to superannuation, presented by National Strategy Manager, Greg Bird.
This document provides an overview and tips for 2017 individual tax planning. It summarizes key tax rates, deductions, credits, and strategies to consider for reducing tax liability for the year. Potential tax reform proposals could change rates and provisions for 2018, so the document recommends planning based on current tax law and taking advantage of opportunities before year-end 2017 to be effective in mitigating taxes. It includes charts outlining various tax rates, limits, phaseouts and considerations for married and unmarried filers.
The document summarizes a presentation given by Terrance Resnick on business succession and estate planning. It discusses how inefficient succession planning is a leading cause of family businesses failing between the first and second generation. It provides a checklist of issues that should be addressed in a business succession plan and highlights common mistakes made, such as relying solely on an "I love you will" that leaves everything to a spouse.
This document discusses various retirement planning strategies using your business. It begins by asking how much readers think retirement will cost and lists common estimates. It then outlines an agenda to cover accumulating money pre-tax and after-tax, different plan types, taxation of retirement income, and combining plans. The document discusses strategies like qualified plans, IRAs, annuities, and life insurance to save both pre-tax and after-tax. It emphasizes the benefits of tax-deferred growth and argues readers should diversify their strategies between taxable, pre-tax, tax-deferred, and tax-free approaches. The document suggests meeting to review the reader's goals, existing plans, and make recommendations to help achieve their retirement objectives.
Superannuation Changes | Family Business Accoutnants | WestcourtCraig Seddon
- The annual before-tax contribution caps for concessional contributions to superannuation are $25,000 for those under age 49 and $30,000 for those over age 49.
- The tax on concessional contributions within the cap is 15% for those with income under $250,000 and increases to 30% for income over $300,000 from July 1, 2017.
- There are also proposed reforms to non-concessional contribution caps, spouse contribution caps and offsets, and superannuation pension limits.
The document provides an overview of financial planning, including the financial planning process, goals, and strategies. It discusses analyzing current financial resources and priorities, developing a personalized plan, implementing recommendations, and keeping the plan updated. It also addresses organizing personal finances through a net worth statement and budget, ways to increase net worth, and the impact of taxes on investments. The overall document serves as an introduction to financial planning concepts.
The document summarizes the Florida state deferred compensation retirement program. It provides three key components to preparing for retirement: the Florida Retirement System pension or investment plan, supplemental savings like deferred compensation or IRAs, and Social Security benefits. It describes how deferred compensation works by allowing pre-tax contributions and growth over time. It lists investment providers and contribution limits and benefits of the program like tax deferral and flexibility.
Super Caps are coming soon, great investment alternatives are already here. Sarah McGavin
View our presentation on how an investment bond can help you grow your clients’ wealth and be a complement to superannuation, presented by National Strategy Manager, Greg Bird.
This document provides an overview and tips for 2017 individual tax planning. It summarizes key tax rates, deductions, credits, and strategies to consider for reducing tax liability for the year. Potential tax reform proposals could change rates and provisions for 2018, so the document recommends planning based on current tax law and taking advantage of opportunities before year-end 2017 to be effective in mitigating taxes. It includes charts outlining various tax rates, limits, phaseouts and considerations for married and unmarried filers.
The document summarizes a presentation given by Terrance Resnick on business succession and estate planning. It discusses how inefficient succession planning is a leading cause of family businesses failing between the first and second generation. It provides a checklist of issues that should be addressed in a business succession plan and highlights common mistakes made, such as relying solely on an "I love you will" that leaves everything to a spouse.
This document discusses various retirement planning strategies using your business. It begins by asking how much readers think retirement will cost and lists common estimates. It then outlines an agenda to cover accumulating money pre-tax and after-tax, different plan types, taxation of retirement income, and combining plans. The document discusses strategies like qualified plans, IRAs, annuities, and life insurance to save both pre-tax and after-tax. It emphasizes the benefits of tax-deferred growth and argues readers should diversify their strategies between taxable, pre-tax, tax-deferred, and tax-free approaches. The document suggests meeting to review the reader's goals, existing plans, and make recommendations to help achieve their retirement objectives.
Super contributions: New rules and key issues for June 30netwealthInvest
Learn the new superannuation contribution rules you should be aware of and understand how they could affect your super savings. Nigel Smith, Netwealth technical consultant, discusses ahead of June 30, 2018.
The document provides an overview of helpful tax tips and savings opportunities for the 2016 tax season, presented by Monica Silwanowicz. It discusses limitations on itemized deductions, personal exemptions, and the alternative minimum tax. It also covers opportunities like donating appreciated assets to charity, qualified charitable distributions from IRAs, and potential impacts of tax reform proposals on businesses, individuals, itemized deductions, and estate taxes. The document aims to help taxpayers maximize deductions and plan effectively for the upcoming tax year.
Variable annuities and mutual funds are long-term investment vehicles designed for retirement. Variable annuities offer tax-deferred growth and death benefits while mutual funds allow for more flexibility but do not provide the same tax benefits. Both have associated fees that impact returns. Retirement planning should consider factors like longer lifespans, inflation, and rising healthcare costs to ensure adequate savings.
This document provides an overview of 10 key tax strategies for real estate investors:
1. Failing to properly plan taxes can be costly. Proper planning through deductions, credits, and income shifting can save significant taxes.
2. Business owners should avoid "audit paranoia" and carefully document expenses.
3. Missing depreciation deductions is a common mistake, especially for improvements, components, and personal property.
4. Distinguishing between repairs and improvements is important for deducting costs.
5. Investors enjoy tax benefits like depreciation, while dealers face self-employment taxes and ordinary income.
6. Employing family members can generate tax savings through deductions and reduced payroll taxes.
Proactive Year-end Financial and Tax Planning StrategiesAICPA
In the third webcast in the AICPA Insights Live webcast series, Beth Gamel, CPA/PFS, Robert S. Keebler, CPA, Ted Sarenski, CPA/PFS and Scott Sprinkle, CPA/PFS, CGMA came together to discuss year-end financial and tax planning strategies, specifically to address the American Taxpayer Relief Act and the Net Investment Income Tax. Below you can find an audio recording from the webcast, as well as the accompanying presentation. Be sure to explore the other webcasts in the AICPA Insights Live webcast series.
Bunching Tax Deductions to Maximize Their BenefitSarah Cuddy
Bunching expenses, particularly charitable gifts, in one year rather than over multiple can provide added tax benefits, especially after the latest tax law changes. And combining that plan with a donor-advised fund can compound the tax savings.
This document provides an overview of various ways to contribute funds into a self-managed superannuation fund (SMSF), including rollovers from other super funds, concessional contributions up to an annual limit of $25,000, non-concessional contributions up to $100,000 annually, downsizing contributions up to $300,000 for those over 65, super co-contributions for eligible personal contributions, CGT cap elections for contributions from small business asset sales, and limited recourse borrowing arrangements to purchase assets for the SMSF. Additional details are given around taxation treatment and eligibility rules for each type of contribution.
A Charitable Remainder Trust is a split interest trust consisting of an income interest, which is paid to the donor or other beneficiary during the term of the trust, and a remainder interest, which is paid to the designated charity. The purpose of this strategy is to harbor net investment income in a tax-exempt environment while leveling income over a longer period of time to keep MAGI below the threshold amount. CRTs are especially useful when there is a large capital gain that pushes income above the threshold amount.
The document provides information about common life events that can affect tax situations and advises contacting a tax professional for advice on tax implications. It lists several major life changes like job changes, marriages, retirements, home purchases or sales, and distributions from retirement accounts that could impact taxes. Taxpayers are encouraged to consult a tax professional in advance of any transactions to understand potential tax effects and avoid negative consequences with proper planning.
Healthcare| Ontario| | Analysis and Commentary| January 2019paul young cpa, cga
Healthcare is a key area for many countries
Canada spends roughly 10% of GDP on healthcare or about $200B. Approximately 20% comes from the federal government through the HST
The largest expenditures for provinces is healthcare. Ontario for example spends around $55B or about 40% of their budget on healthcare
There is lots of waste within healthcare as many provinces have not done a very good job when it comes to value for money/healthcare
The delivery model is broken!
The right tax strategy stays current with your environment.
The political landscape isn’t the only thing changing in
2016. Estate planning opportunities are also shifting. This
supplement incorporates estate planning updates and other
considerations into tips designed to decrease your 2016 tax
bill. Charts throughout the supplement, including tax rates,
qualified retirement plan limitations and FICA/Medicare
taxes further help with your tax planning.
This document provides information about enrolling in a 401(k) retirement plan. It outlines the plan features including eligibility requirements, contribution limits, employer matching, and vesting schedules. It also describes how to enroll by completing enrollment forms, selecting investments, naming beneficiaries, and turning in paperwork. Additional sections discuss the benefits of saving in a 401k plan and accessing account information online.
The document defines key tax terms to help understand filing taxes. It explains that adjusted gross income includes all income minus certain deductions like IRA contributions and alimony payments. Tax credits directly reduce taxes owed, while deductions lower taxable income. Itemized deductions subtract expenses from adjusted gross income. Standard deductions are fixed amounts subtracted based on filing status. Exemptions subtract amounts for dependents. The U.S. uses progressive taxation where higher incomes face higher tax rates. Taxable income is the final amount used to calculate taxes owed after deductions and exemptions. Withholding takes taxes from paychecks throughout the year. Voluntary compliance refers to taxpayers honestly reporting income.
Queensland Public Sector Discussion Group 20th October 2016 Presentation SlidesAlarka Phukan CPA, CMA
The document provides important information about the presentation and the organization providing it. It notes that the information is general in nature and shouldn't replace personal advice. It also discloses that the organization is ultimately owned by QSuper but is a separate legal entity responsible for the financial services it provides. The document wants to ensure readers understand certain details and limitations around the information.
Canadian Tax Insights: How High Net Worth Investors Should Navigate Today’s T...Nicola Wealth
In this webinar, Nicola Wealth CEO, John Nicola will address timely taxation topics to help you understand the developments in Canadian tax policy in relation to the taxation of homes, wealth, capital gains, and marginal tax rates. John will further prepare you to navigate the current tax environment by reviewing several tax planning options available to you and how these strategies integrate with overall portfolio design.
This document discusses strategies for navigating retirement challenges and outlines 5 strategies to help achieve a more fulfilling retirement: 1) Optimize investment portfolio, 2) Minimize income taxes, 3) Plan for extended health care costs, 4) Consider guaranteed income products for life, and 5) Consider other sources of retirement income. It addresses common retirement challenges such as inflation, outliving savings, taxes, expenses, and managing expectations.
The document provides an overview of the 2010 healthcare reform legislation and subsequent tax law changes. It notes that the legislation was passed in two parts in 2010, containing provisions such as a small business tax credit for offering health coverage, elimination of lifetime caps on insurance, and penalties for remaining uninsured beginning in 2014. The summary also outlines numerous tax law provisions from 2010-2018 related to health savings accounts, deductions, credits, fees and more.
Super Reforms – The changes and what you need to doChris Reed
The document summarizes key changes to Australia's superannuation system and actions account holders should take. Lower caps will apply to non-concessional and concessional contributions from July 1, 2017. A $1.6 million transfer balance cap will apply to income streams. Transition to retirement pensions will no longer provide tax-free earnings. SMSFs need to review pensions, reserves, and contribution strategies. Account holders should review their situation and strategies with an advisor before June 30.
Super contributions: New rules and key issues for June 30netwealthInvest
Learn the new superannuation contribution rules you should be aware of and understand how they could affect your super savings. Nigel Smith, Netwealth technical consultant, discusses ahead of June 30, 2018.
The document provides an overview of helpful tax tips and savings opportunities for the 2016 tax season, presented by Monica Silwanowicz. It discusses limitations on itemized deductions, personal exemptions, and the alternative minimum tax. It also covers opportunities like donating appreciated assets to charity, qualified charitable distributions from IRAs, and potential impacts of tax reform proposals on businesses, individuals, itemized deductions, and estate taxes. The document aims to help taxpayers maximize deductions and plan effectively for the upcoming tax year.
Variable annuities and mutual funds are long-term investment vehicles designed for retirement. Variable annuities offer tax-deferred growth and death benefits while mutual funds allow for more flexibility but do not provide the same tax benefits. Both have associated fees that impact returns. Retirement planning should consider factors like longer lifespans, inflation, and rising healthcare costs to ensure adequate savings.
This document provides an overview of 10 key tax strategies for real estate investors:
1. Failing to properly plan taxes can be costly. Proper planning through deductions, credits, and income shifting can save significant taxes.
2. Business owners should avoid "audit paranoia" and carefully document expenses.
3. Missing depreciation deductions is a common mistake, especially for improvements, components, and personal property.
4. Distinguishing between repairs and improvements is important for deducting costs.
5. Investors enjoy tax benefits like depreciation, while dealers face self-employment taxes and ordinary income.
6. Employing family members can generate tax savings through deductions and reduced payroll taxes.
Proactive Year-end Financial and Tax Planning StrategiesAICPA
In the third webcast in the AICPA Insights Live webcast series, Beth Gamel, CPA/PFS, Robert S. Keebler, CPA, Ted Sarenski, CPA/PFS and Scott Sprinkle, CPA/PFS, CGMA came together to discuss year-end financial and tax planning strategies, specifically to address the American Taxpayer Relief Act and the Net Investment Income Tax. Below you can find an audio recording from the webcast, as well as the accompanying presentation. Be sure to explore the other webcasts in the AICPA Insights Live webcast series.
Bunching Tax Deductions to Maximize Their BenefitSarah Cuddy
Bunching expenses, particularly charitable gifts, in one year rather than over multiple can provide added tax benefits, especially after the latest tax law changes. And combining that plan with a donor-advised fund can compound the tax savings.
This document provides an overview of various ways to contribute funds into a self-managed superannuation fund (SMSF), including rollovers from other super funds, concessional contributions up to an annual limit of $25,000, non-concessional contributions up to $100,000 annually, downsizing contributions up to $300,000 for those over 65, super co-contributions for eligible personal contributions, CGT cap elections for contributions from small business asset sales, and limited recourse borrowing arrangements to purchase assets for the SMSF. Additional details are given around taxation treatment and eligibility rules for each type of contribution.
A Charitable Remainder Trust is a split interest trust consisting of an income interest, which is paid to the donor or other beneficiary during the term of the trust, and a remainder interest, which is paid to the designated charity. The purpose of this strategy is to harbor net investment income in a tax-exempt environment while leveling income over a longer period of time to keep MAGI below the threshold amount. CRTs are especially useful when there is a large capital gain that pushes income above the threshold amount.
The document provides information about common life events that can affect tax situations and advises contacting a tax professional for advice on tax implications. It lists several major life changes like job changes, marriages, retirements, home purchases or sales, and distributions from retirement accounts that could impact taxes. Taxpayers are encouraged to consult a tax professional in advance of any transactions to understand potential tax effects and avoid negative consequences with proper planning.
Healthcare| Ontario| | Analysis and Commentary| January 2019paul young cpa, cga
Healthcare is a key area for many countries
Canada spends roughly 10% of GDP on healthcare or about $200B. Approximately 20% comes from the federal government through the HST
The largest expenditures for provinces is healthcare. Ontario for example spends around $55B or about 40% of their budget on healthcare
There is lots of waste within healthcare as many provinces have not done a very good job when it comes to value for money/healthcare
The delivery model is broken!
The right tax strategy stays current with your environment.
The political landscape isn’t the only thing changing in
2016. Estate planning opportunities are also shifting. This
supplement incorporates estate planning updates and other
considerations into tips designed to decrease your 2016 tax
bill. Charts throughout the supplement, including tax rates,
qualified retirement plan limitations and FICA/Medicare
taxes further help with your tax planning.
This document provides information about enrolling in a 401(k) retirement plan. It outlines the plan features including eligibility requirements, contribution limits, employer matching, and vesting schedules. It also describes how to enroll by completing enrollment forms, selecting investments, naming beneficiaries, and turning in paperwork. Additional sections discuss the benefits of saving in a 401k plan and accessing account information online.
The document defines key tax terms to help understand filing taxes. It explains that adjusted gross income includes all income minus certain deductions like IRA contributions and alimony payments. Tax credits directly reduce taxes owed, while deductions lower taxable income. Itemized deductions subtract expenses from adjusted gross income. Standard deductions are fixed amounts subtracted based on filing status. Exemptions subtract amounts for dependents. The U.S. uses progressive taxation where higher incomes face higher tax rates. Taxable income is the final amount used to calculate taxes owed after deductions and exemptions. Withholding takes taxes from paychecks throughout the year. Voluntary compliance refers to taxpayers honestly reporting income.
Queensland Public Sector Discussion Group 20th October 2016 Presentation SlidesAlarka Phukan CPA, CMA
The document provides important information about the presentation and the organization providing it. It notes that the information is general in nature and shouldn't replace personal advice. It also discloses that the organization is ultimately owned by QSuper but is a separate legal entity responsible for the financial services it provides. The document wants to ensure readers understand certain details and limitations around the information.
Canadian Tax Insights: How High Net Worth Investors Should Navigate Today’s T...Nicola Wealth
In this webinar, Nicola Wealth CEO, John Nicola will address timely taxation topics to help you understand the developments in Canadian tax policy in relation to the taxation of homes, wealth, capital gains, and marginal tax rates. John will further prepare you to navigate the current tax environment by reviewing several tax planning options available to you and how these strategies integrate with overall portfolio design.
This document discusses strategies for navigating retirement challenges and outlines 5 strategies to help achieve a more fulfilling retirement: 1) Optimize investment portfolio, 2) Minimize income taxes, 3) Plan for extended health care costs, 4) Consider guaranteed income products for life, and 5) Consider other sources of retirement income. It addresses common retirement challenges such as inflation, outliving savings, taxes, expenses, and managing expectations.
The document provides an overview of the 2010 healthcare reform legislation and subsequent tax law changes. It notes that the legislation was passed in two parts in 2010, containing provisions such as a small business tax credit for offering health coverage, elimination of lifetime caps on insurance, and penalties for remaining uninsured beginning in 2014. The summary also outlines numerous tax law provisions from 2010-2018 related to health savings accounts, deductions, credits, fees and more.
Super Reforms – The changes and what you need to doChris Reed
The document summarizes key changes to Australia's superannuation system and actions account holders should take. Lower caps will apply to non-concessional and concessional contributions from July 1, 2017. A $1.6 million transfer balance cap will apply to income streams. Transition to retirement pensions will no longer provide tax-free earnings. SMSFs need to review pensions, reserves, and contribution strategies. Account holders should review their situation and strategies with an advisor before June 30.
Your guide to understanding the new Transfer Balance Reporting Requirements (...Bentleys (WA) Pty Ltd
Find out what SMSF trustees can expect under the new SMSF event-based reporting regime. Is your SMSF ready for TBAR reporting requirements that are coming into effect on the 1 July 2018?
Find out what these changes mean for you and how they will affect your SMSF.
With the new super rules beginning on 1 July 2017, your requirement to report information about your SMSF and the pensions it pays you and other fund members may be changing. This is driven by the introduction of the new $1.6 million transfer balance cap which limits the amount of assets you can use to pay pensions from super with.
Currently, pensions only need to be reported once a year through the SMSF annual tax and regulatory return to the Australian Taxation Office (ATO).
From 1 July 2018, if a member of your SMSF has $1 million or more in superannuation and a member of the fund is receiving a pension from superannuation assets then your SMSF will be required to report more information about its members’ pension than currently needed. This is so the ATO can accurately monitor your transfer balance cap to know if you have exceeded the $1.6 million limit. Going over the $1.6 million transfer balance cap limit can result in needing to pay additional tax.
The document summarizes recent changes to Australia's superannuation system announced in the 2016 federal budget. Key changes include lowering the concessional contributions cap to $25,000 per year, introducing a $1.6 million transfer balance cap on superannuation that can be transferred to pension phase, and implementing a $500,000 lifetime cap on non-concessional contributions. The changes aim to simplify the system, reduce tax concessions, and ensure superannuation is used primarily for retirement. Many of the changes will take effect on July 1, 2017, though some provisions are delayed or still require legislation.
This document provides a summary of the 2013 Australian federal budget and post-budget updates. It outlines key budget measures such as spending cuts, tax changes, and policy initiatives. Major points include a forecast budget deficit of $18 billion for 2013-2014, the deferral of planned tax cuts, and the introduction of the National Disability Insurance Scheme funded by a rise in the Medicare levy. The document also provides tax planning tips for individuals, families, and businesses prior to the end of the 2013 financial year.
Garvin Jones, Director – Superannuation & Business Solutions, Hill Rogers updates key changes to the superannuation environment including:
- Last chance to take advantage of 'generous' contributions?
- Busting common myths
- Key actions before 30 June
- Over $1.6m? - leave or withdraw & invest outside of super
- 2017 budget announcements
Choosing a retirement plan for your business 2013giannem1
Discusses various types of retirement plans you may wish to consider for your business. There are a variety of retirement plans available for small businesses, each with their own nuances.
Contact me to discuss which one makes sense for your business.
This document summarizes a presentation for barristers on running a business as a barrister. It covers topics like understanding business structures, accounting and invoicing, tax obligations, using debt, budgeting and cash flow management, asset protection, estate planning, retirement planning, and getting the right professional team. It provides an agenda and discusses concepts like understanding different entity structures, accounting on a cash basis, personal income tax rates, timing of tax obligations, using good versus bad debt, preparing budgets and cash flows, and leveraging structures like superannuation and trusts to protect assets and plan for retirement.
2016 Federal Budget - Strategies for financial advisersnetwealthInvest
Following the announcement of the 2016 Federal Budget, netwealth's Technical Services team analysed the proposed legislative changes and developed some possible strategies for financial advisers to use with their clients.
Tax Reform and the Impact to your Franchise by Honkamp Krueger4 2018rhauber
The recent Tax Cuts and Jobs Act aka Tax Reform has made a significant impact on the tax situation of franchise business owners. Our slide deck provides the business tax and individual tax highlights of the Tax Cuts and Jobs Act for franchise organizations.
The document summarizes key aspects of the Affordable Care Act for small businesses. It discusses requirements for employers around full-time employee definitions, coverage requirements, taxes, and penalties beginning in 2010 through 2018. Business owners are encouraged to consider how the law affects their business size, employee costs and benefits, and strategies for staying compliant over time.
Congress has approved H.R. 1 the Tax Cuts and Jobs Act, significantly altering the U.S. tax code. Join us to learn more about what the new legislation means for individuals and businesses, including corporations and pass through entities.
Join us for a conversation about how tax reform impacts individuals and businesses, including corporations and pass through entities.
The document provides an overview of Tax-Free Savings Accounts (TFSAs) in Canada, including basic features, eligibility, contribution limits, withdrawals, transfers, and strategies for using TFSAs. Key points are that TFSAs allow tax-free growth of investment income and withdrawals, contributions are not tax deductible, and unused contribution room can be carried forward to future years. The document also compares TFSAs to non-registered and RRSP accounts, and notes services an advisor can provide regarding TFSAs.
Back to the future seminar 2017 | Family Business Accountants | WestcourtCraig Seddon
The document provides tips and strategies for individuals and businesses to minimize tax before the end of the financial year on June 30th, as well as changes coming into effect in future years. It discusses opportunities to make superannuation and other contributions, claims deductions for expenses, and manages capital gains and losses. It also outlines reforms increasing small business tax concessions and farm management deposit limits.
Our straight talking presenters cut through the complexity to deliver relevant Tax and Superannuation insights contained in the 2018 Federal Budget. In addition, our presenters recap on the Pre Financial Year End initiatives that can be considered during the tax planning season.
The document discusses various deadlines and regulations related to the Patient Protection and Affordable Care Act (PPACA). It notes that deadlines vary based on plan renewal dates and that regulatory clarifications continue to be issued. It also discusses the impact of the Supreme Court ruling upholding the individual mandate and notes that implementation of the law will continue to move forward. Grandfathered plans are discussed, including allowable changes without losing grandfathered status. The small business tax credit provisions are outlined. Coverage of adult children up to age 26 and new preventive service mandates are also summarized.
Small Business Tax Considerations Under the Health Reform and HIRE ActsStambaugh Ness, PC
The document summarizes small business tax considerations related to the Federal Health Care Reform and HIRE Acts. It provides details on the small business health insurance tax credit available from 2010-2013 for employers with fewer than 25 FTEs offering qualifying health insurance. It also outlines the payroll tax exemption and retention credit available to employers under the HIRE Act for hiring and retaining qualified workers.
Congress has approved H.R. 1 the Tax Cuts and Jobs Act, significantly altering the U.S. tax code. Join us to learn more about what the new legislation means for individuals and businesses, including corporations and pass through entities.
This WEBINAR is an overview about how the Tax Cuts and Jobs Act alters the U.S. tax code for individuals and businesses.
For more in-depth information and personal engagement with our team, we welcome you to join us on Tuesday, January 30th from 9-11am at our Rockville Location, 1445 Research Boulevard, Ground Level Conference Room, Rockville, MD 20850.
The Tax Reduction Program from Quantum Accountants is designed to lower individuals' tax burden through customized strategies. It is best suited for those earning $70,000 or more annually, though some benefits are possible for lower incomes. The initial fee is $500 with an annual $300 review fee including one free tax return. Additional costs may apply depending on an individual's financial situation. The program guarantees to increase the tax refund from the previous year by 100% or a full refund of the initial $500 fee, assuming the client's financial circumstances remain the same and all recommendations are followed.
Similar to Super rules are changing. Find out what you need to do now. (20)
This document discusses when a TBAR report needs to be lodged for an SMSF. A TBAR report must be lodged if a fund member has a total super balance of $1m or more, or if a new pension has commenced. The deadline for lodging TBAR reports is July 1st if a pension existed in the prior year, or within 28 days of the quarter in which a new pension commenced.
Tax cuts for everybody eventually… The most friendly budget?
Leading his third Federal Budget, Treasurer Scott Morrison has focussed on tax cut “affordability” and delivering a “responsible” budget that will encourage consumer spending and economic growth, without damaging the reduction of the national debt and drive to surplus. The winners in the 2018 budget are taxpayers on lower income tax brackets, older Australians and small business.
In keeping with previous years, this year’s budget delivered few surprises. But the question remains – has Treasurer Scott Morrison done enough to convince the electorate that the Coalition Government should be returned to power? It is a fine balancing act for the Government as it endeavours to appease the electorate – which has not seen an increase in real wages for several years amidst rising household costs – while, at the same time, needing to maintain its position of being fiscally responsible and getting the economy back into surplus by 2019-20.
The 2018 Federal Budget document outlines several tax changes and policy measures that will impact individuals, families, businesses, and the economy. Key points include immediate tax relief for low and middle-income earners, capping refundable research and development tax offsets at $4 million annually, extending the instant asset write-off for businesses, and protecting low superannuation balances. The budget aims to boost innovation, provide tax cuts for responsibility and affordability, and strengthen efforts to combat tax avoidance and the black economy.
This document provides an agenda and overview for a financial reporting and audit update presentation on April 2018. The presentation will cover new accounting standards for June 30, 2018 financial reports, reminders about new standards such as AASB 9, AASB 15, and AASB 16, and other topics such as the ACNC legislative review and standards issued but not yet effective. The presentation will be split into two parts, with the first part covering new standards and reminders, and the second part discussing additional topics such as crypto-currencies and new audit reports.
With the election of Donald Trump ushering in a dramatic change to the US policy framework, we look at the potential impact of his policies on growth, interest rates and the markets. We look in particular at the current state of the global equity market and the risks and opportunities it presents to clients if the US economy speeds up and interest rates rise.
Find out the potential economic policy changes as a result of the new US administration and what the impact these policy and economic changes have on global markets, especially equities
This document provides an overview of investment fundamentals and strategies for managing wealth. It discusses diversifying investments across different asset classes like cash, bonds, property and shares to reduce risk. Regular investing and taking a long-term approach can help maximize returns. Managed funds provide diversification and professional management, while direct shares give more control but require more resources. The document aims to help readers make informed investment decisions to achieve their financial goals and lifestyle aspirations.
Let us help you organise your financial affairs, ensuring that your assets go to your chosen beneficiaries in the most structured and tax effective way.
Do you have children or elderly parents? What about savings or a home?
If you answered yes to any of these, here's another question for you: Do you have an estate plan in place?
Planning is the key, this workshop will run through:
• What is estate planning?
• What is a Will and why make one?
• What assets are governed by a Will?
• What assets aren’t governed by a Will?
• Testamentary trusts
• Blended families
• Power of Attorney
• Tax effective estate planning
Australia needs to remain competitive on a global market and to do this the government needs to deliver a budget that will give the right level of monetary support to the right areas, but will the Turnbull Government focus on the areas that need it most?
What will the 2017 Federal budget mean for local business, our state economy, and what are the taxation and political implications?
If the rumours are to be believed the budget that will be handed down on the 9th of May will focus on tax cuts and housing prices.
Will the Government cut taxes for all businesses or just some? Will it tinker with negative gearing or the CGT discount? Will it do more than reaffirm what has already been said in specific industries?
Join the Bentleys team for our 2017 Federal Budget Insights where our expert team will analyse and review what the changes mean to you as an individual and as a business.
Insight into the changes in financial reporting requirements
Highlighting current hot topics
Providing you with practical application of these changes
Showing you how to address these issues holistically in the “real-world” context
Discuss the issues in the context of implementation issues and hurdles
Keep up to date & improve your reporting skills
Bentleys is proud to present this Critical Financial Reporting Update for all financial statement preparers, designed specifically to address the current hot issues & new developments facing our profession.
The update will provide you with practical solutions, tools and skills that will make the preparation of your financial statements easier.
- Commodity prices have fluctuated significantly over the past 30 years, with iron ore prices experiencing a large boom in the late 2000s and early 2010s.
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This document provides the results of a survey of Australian small and medium enterprises (SMEs). Some key findings include:
- Confidence in business prospects is growing overall, with larger SMEs feeling more confident than smaller ones.
- Cash flow and growing revenue are the top concerns for SMEs.
- Larger businesses are more likely to look to external advice and guidance, while outsourcing and technology adoption is increasing overall.
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This document provides an economic update from Bankwest Chief Economist Alan Langford. It includes charts and graphs on topics such as interest rates, commodity prices, housing market indicators, GDP growth, income and employment for Australia with some focus on Western Australia. The presentation was delivered on December 1, 2016 to Bentleys key clients.
The fifth wave of The Voice survey explored Australian SMEs' business confidence, technology attitudes, interest in foreign investment, and views on superannuation. Overall confidence has recovered slightly since a dip six months ago, driven mainly by improved outlook among small businesses. Larger SMEs remain more confident than micro businesses. For the coming year, most SMEs aim to improve profits and cash flow, while medium and small businesses expect to grow through hiring, investment, and new initiatives. Some micro businesses anticipate exiting industries. Perceived barriers to growth include the economy, competition, and consumer demand.
The Voice of Australian Business is a long term research project that follows and explores the mindset, needs, expectations and concerns of the Small to Medium (SME) business environment in Australia. The survey is conducted online with business owners, ‘C’ suite or Directors (decision makers) who are remunerated for their time. The survey has been carried out twice a year since 2014 and each survey examines key areas of SME concerns yet retains lines of questioning around business confidence, growth and technology.
This is the fIfth ‘Voice’ survey and the data represents what SMEs are telling us.
The home care reforms will allow approved home care providers to market their services through My Aged Care and attract more clients. Providers offering residential care can also become home care providers through a simplified process. However, the key impact will be increased competition for funding across the sector, requiring home care providers to reconfigure staffing models and improve treasury management. Providers need to consider how to strengthen their policies, review their business models to handle fluctuating demand, stress test financial forecasts, and plan for potential risks from upcoming funding shifts in July 2018.
The Role of Innovation and the Evolution of the R&D Tax IncentiveBentleys (WA) Pty Ltd
The document discusses innovation, the R&D tax incentive in Australia, recent legislative changes and case law related to the incentive. It provides an overview of the incentive, noting it provides accelerated tax deductions and potential refunds for companies conducting R&D. It outlines key reviews and proposed changes to incentive rates. It summarizes two relevant case law decisions regarding what activities qualify for the incentive. It also discusses current compliance focuses and best practices for documenting R&D to qualify for the incentive.
The document summarizes the findings of the fourth survey conducted as part of The Voice of Australian Business research project. Some key findings include:
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The group has adopted all new and revised accounting standards issued by the Australian Accounting Standards Board that are mandatory for the current reporting period. The adoption of these standards did not have a significant financial impact. Several new standards on financial instruments, revenue recognition and leases have been issued but are not yet mandatory and have not been early adopted by the group. The group is still assessing the impacts of these new standards.
1. Elemental Economics - Introduction to mining.pdfNeal Brewster
After this first you should: Understand the nature of mining; have an awareness of the industry’s boundaries, corporate structure and size; appreciation the complex motivations and objectives of the industries’ various participants; know how mineral reserves are defined and estimated, and how they evolve over time.
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Laura Adkins-Hackett, Economist, LMIC, and Sukriti Trehan, Data Scientist, LMIC, presented their research exploring trends in the skills listed in OJPs to develop a deeper understanding of in-demand skills. This research project uses pointwise mutual information and other methods to extract more information about common skills from the relationships between skills, occupations and regions.
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After this second you should be able to: Explain the main determinants of demand for any mineral product, and their relative importance; recognise and explain how demand for any product is likely to change with economic activity; recognise and explain the roles of technology and relative prices in influencing demand; be able to explain the differences between the rates of growth of demand for different products.
Falcon stands out as a top-tier P2P Invoice Discounting platform in India, bridging esteemed blue-chip companies and eager investors. Our goal is to transform the investment landscape in India by establishing a comprehensive destination for borrowers and investors with diverse profiles and needs, all while minimizing risk. What sets Falcon apart is the elimination of intermediaries such as commercial banks and depository institutions, allowing investors to enjoy higher yields.
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The Rise of Generative AI in Finance: Reshaping the Industry with Synthetic DataChampak Jhagmag
In this presentation, we will explore the rise of generative AI in finance and its potential to reshape the industry. We will discuss how generative AI can be used to develop new products, combat fraud, and revolutionize risk management. Finally, we will address some of the ethical considerations and challenges associated with this powerful technology.
2. Accountants AdvisorsAuditors
Disclaimer
This document contains general advice. It does not take account of your objectives, financial situation or
needs.You should consider talking to a FinancialAdviser before making a financial decision.
This document has been prepared by Count Financial LimitedABN 19 001 974 625,AFSL 227232, (Count) a
wholly-owned, non-guaranteed subsidiary of Commonwealth Bank of Australia
ABN 48 123 123 124. ‘Count’ andCountWealth Accountants® are trading names of Count.
Count FinancialAdvisers are authorised representatives of Count. Information in this document is based on
current regulatory requirements and laws, as at 1 March 2017, which may be subject to change.
While care has been taken in the preparation of this document, no liability is accepted by Count, its related
entities, agents and employees for any loss arising from reliance on this document.
3. Accountants AdvisorsAuditors
The super changes at a glance
Lower caps on
non-concessional contributions
Lower caps on concessional
contributions
Reduced threshold for higher
contributions tax
New $1.6m transfer
balance cap
Removal of tax-exempt
status for TTR pensions
Tax offset for low
income earners
Deduction for personal
contributions extended
Key changes
4. Accountants AdvisorsAuditors
Lower caps on non-concessional
contributions
Remaining cap also reduced if
have not fully utilised
$540,000 by 1 July 2017
1 JULY
2017
Current Caps
$180,000
Annual Cap
$540,000
3-year ‘bring forward’ cap
New Caps
$100,000
Annual Cap
$300,000
3-year ‘bring forward’ cap
5. Accountants AdvisorsAuditors
Lower caps on non-concessional
contributions
TOTAL SUPER
BALANCE
Non-concessional cap
$100,000
Annual Cap
$300,000
3-year ‘bring forward’ cap
$1.6M+
NIL
6. Accountants AdvisorsAuditors
Lower caps on non-concessional
contributions
Can’t make
non-concessional
once saved more
than $1.6M
Current cap
continues
to apply to
30 June 2017
Maximum
contributions
reduced from
1 July 2017
Transitional rules
for people still in
‘bring forward’
period
11. Accountants AdvisorsAuditors
CGT relief for assets moved to
accumulation phase
Gains accrued in pension phase
Transitional
CGT relief
Reset cost base of certain assets
moved back to accumulation
Only funds impacted by transfer
balance cap or TTR reforms
SMSF and super wrap clients
Different eligibility
requirements
Rules extremely complex
12. Accountants AdvisorsAuditors
Income stream – key points
Cannot commence new
pensions for more than
$1.6M from 1 July 2017
Transitional CGT relief
available for SMSFs and
super wraps
Existing pensions must be reduced to
$1.6M by 30 June 2017
Need to take action before 1
July 2017
14. Accountants AdvisorsAuditors
No TTR
$355,000
TTR current
rules
$381,000
(extra
$26,000)
TTR new rules
$374,000
(extra
$19,000)
Transition to retirement pension
changes
Transition to
retirement (TTR)
Strategy example
Emily
Age 61
(retiring in 4 years)
Earns $60,000, has
$250,000 in super
After four yearsLet’s compare TTR
strategies
15. Accountants AdvisorsAuditors
Income stream – key points
Earnings on TTR
pensions taxable
from 1 July 2017
Transitional CGT
relief available for
impacted funds
Existing pensions
must be reviewed
Potentially still
very useful
16. Accountants AdvisorsAuditors
Other changes
Spouse contribution tax
offset ($540)
Not eligible once spouse
income exceeds $13,800
Upper threshold to be
increased to $40,000
from 1 July 2017
Low income super
tax offset ($500)
Government contribution
to refund impact of
contributions tax where
income less than $37,000 pa
Essentially a continuation
of current low income
super contribution
Deduction for personal
contributions extended
Deductions currently restricted to self
employed and other ‘eligible’
taxpayers
Eligibility criteria removed from
1 July 2017
Allow people to claim tax deduction
for contributions they make to super
End of year bonus
Proceeds from asset sale
Must submit deduction notice
Strict timeframes
18. Accountants AdvisorsAuditors
Special Offer:
Trust Deed Update
Remember that even though the superannuation laws have changed, your trust deed does not. This means that
the trustee and members may be unable to make use of the changes because their trust deed does not
empower them appropriately.
Future proof your SMSF and take full advantage of new opportunities.
A comprehensive & modernised trust deed update, incorporating all the
amendments for July 2017 and onwards
$500 (plus GST)
Contact Brad or Nick for more details on updating your trust deed.
brad@aussiesuper.com.au
ngahan@perth.Bentleys.com.au
In last year’s Federal Budget, the government proposed a wide range of reforms to Australia’s superannuation system.
Since then, there’s been a lot of discussion and debate around these proposals, which are the most significant reforms to super that have happened in the last 10 years.
As a result, many people have been left feeling a bit confused about what’s actually changing.
Although not all the proposals have been legislated, some significant ones were passed by parliament late last year. That means some important changes will take effect on 1 July this year.
So I wanted to go through these changes today with you in detail, so you can see exactly what they involve and whether they’ll affect you.
Here are the main areas we’ll be looking at today:
The lower caps for non-concessional and concessional super contributions. I’ll be explaining the difference between these if you’re not sure.
The reduced threshold for people who have to pay additional tax on their contributions.
The introduction of a new $1.6 million transfer balance cap on assets in your super’s tax-free pension phase.
Changes to how transition-to-retirement – or TTR – pensions are treated.
A low income superannuation tax offset which replaces the current low income superannuation contribution
And finally, extending the availability of tax deductions when making personal contributions to your super.
Once I’ve been through the changes, feel free to ask any questions or let me know if you need me to explain something again in more detail.
First up, we’ll look at non-concessional or ‘after-tax’ super contributions.
FIRST TRANSITION
These include things like contributions you make out of your after-tax salary, or maybe a lump sum you put into super after selling a property or getting an inheritance. Non-concessional contributions also include any contributions you make to your spouse’s super.
There’s a limit to how much you can put into your super through non-concessional contributions each financial year. At the moment, non-concessional contributions are capped at $180,000 per year, and you can only make them up to the age of 65 – or 75 if you’re still working.
But if you’re under 65, there’s also something called the ‘bring-forward’ rule. This means you can make up to three years’ worth of non-concessional contributions at any time during a three-year period, as long as you don’t go over 3 x $180,000 (which is $540,000) during that period.
The current caps of $180,000 a year and $540,000 for three years will stay in place until 30 June.
SECOND TRANSTION
On 1 July, these caps are going to be reduced. From that date onwards, you’ll only be allowed to make $100,000 per year in non-concessional (or after-tax) contributions.
The three-year cap will also go down to 3 x $100,000 – or $300,000 – instead of $540,000. So that’s the maximum you’ll be able to contribute within a three-year period if you apply the bring-forward rule.
If you’ve triggered the bring-forward rule before 1 July, but you haven’t used up all of your $540,000 cap yet, then the remainder of your cap will be reassessed. This is to take into account the reduction of the annual cap to $100,000.
In this case, your remaining cap will be reduced to the difference between what you’ve already contributed under the bring-forward rule and $380,000 or $460,000 depending on whether you triggered the bring-forward this year or last year.
For instance, let’s say you triggered the bring-forward rule this year and you’ve contributed $240,000 so far. You thought you still had $300,000 left on your cap that you could use over the next two years.
But on 1 July your three-year cap will be reassessed to $380,000, which means you’ll only be able to contribute $140,000 instead of $300,000.
So what does this all mean? Basically, if you’re planning to make a non-concessional contributions anytime soon, you might want to look at making the most of your three-year cap before it gets reduced on 1 July.
Here’s the other thing you need to know about non-concessional contributions.
At the moment you can contribute up to your cap, regardless of how much money you have in super.
SECOND TRANSITION
But from 1 July onwards, if you have more than $1.6 million in super, you won’t be able to make any further non-concessional contributions. So effectively your annual cap and your bring-forward cap will both be reduced to zero.
If your super balance goes back below $1.6 million, you might be able to start making non-concessional contributions again – but only until your balance gets back to $1.6 million.
For those with super balances exceeding $1.4 million, there are some restrictions on being able to use the bring-forward rule that also need to be taken into consideration.
It’s also worth noting that the super balance limit refers to your total super balance as at 30 June in the previous financial year. Therefore, it will be important to check this before making any non-concessional contributions going forward.
So to recap all the upcoming changes to non-concessional contributions:
The current caps will still apply until 30 June – that is $180,000 a year, or $540,000 over three years if you’re under 65 and you trigger the bring-forward rule.
But from 1 July this year, these caps will be reduced. Under the new rules, the most you’ll be able to contribute is $100,000 a year, or $300,000 during a three-year period if you trigger the bring-forward rule while you’re under 65.
At the moment, you might be planning to make large contributions as a key part of your retirement strategy. In this case, you should come and talk to me about your options before the new caps come into effect.
If you’re in what’s called the ‘transitional bring-forward period’ – where you’ve triggered the bring-forward rule in the last three years but you haven’t used up all of your cap yet – then the remaining amount you can contribute will be reassessed downwards.
Again, come and talk to me if your retirement strategy needs to be adjusted because of these changes.
Finally once your balance hits $1.6 million, you won’t be able to make any non-concessional contributions at all.
Now let’s take a look at concessional contributions. These are the contributions you put into super before tax has been taken out.
They include things like the compulsory Super Guarantee payments your employer makes plus any extra you put into super through salary sacrificing. They also include contributions where you’re eligible for a tax deduction – for example, if you make a contribution from self-employed income or from your returns on an investment.
Generally speaking, these types of contributions are taxed at 15% when they go into your super account.
At the moment, there are two different caps for concessional contributions, depending on your age. So if you’re under 50 you can make up to $30,000 worth of concessional contributions a year. And if you’re 50 or over, you can put in up to $35,000 a year.
It’s worth noting that if you’re between 65 and 74 you will need to satisfy a work test before you can make any concessional contributions for yourself, and once you’re 75 you generally won’t be able to make any contributions for yourself at all.
SECOND TRANSITION
So here’s what’s about to change. On 1 July, your concessional cap will go down, regardless of whether you’re under 50 or over 50. From that date there will be a $25,000 cap on concessional contributions across the board for everyone.
So, for instance, if you’re 55 and you’re currently putting $35,000 a year into super through a combination of salary sacrificing and employer contributions, then from 1 July you’ll have to make sure this total doesn’t exceed $25,000. This might mean you have to reduce the amount you’re salary sacrificing each year by $10,000.
It’s also good to know that from 1 July 2018 onwards, if you don’t use the whole cap in one financial year, the unused amount will be carried forward to the next year if your total super balance is less than $500,000. So, for example, if you only make concessional contributions of $20,000 in 2018/2019, then the remaining $5,000 will be added to the next year’s cap – so for the 2019/2020 financial year your total cap will be $30,000. You can keep bringing forward your unused caps each year for up to five years.
Remember, this rule won’t kick in for over a year. But it’s still worth keeping in mind as part of your long-term contribution strategy.
There’s something else you should know about concessional contributions. As I mentioned on the last slide, concessional contributions are generally taxed at 15%. This applies to everyone whose income – including their concessional contributions and certain other amounts, such as reportable fringe benefits – come to less than $300,000 a year.
So, for every $100 you contribute, your super fund pays $15 to the Tax Office.
But if your income adds up to more than $300,000 in a year, your contributions are taxed at double the usual rate.
So, on top of the 15% tax paid through your super fund, you have to pay an additional contributions tax of 15% – which means all up you’re paying 30% in tax on your concessional contributions.
SECOND TRANSITION
But from 1 July, this $300,000 threshold is going down to $250,000. So from that date onwards, if your combined income (including concessional contributions) is more than $250,000 a year, you’ll have to pay an additional 15% tax on your concessional contributions such as the super guarantee and salary sacrifice contributions your employer pays on your behalf.
If you’ll be impacted by this rule, you can elect to either pay the additional tax yourself or have the tax paid from your super fund.
If you think this lower threshold of $250,000 will affect you, it could have a significant impact on your retirement strategy. In that case, come and have a chat with me so we can find the most tax-effective way for you to keep building your nest egg.
OK, let’s recap the upcoming changes to concessional contributions.
The current caps will still apply until 30 June. That means you can make up to $30,000 worth of pre-tax contributions a year if you’re under 50, or $35,000 a year if you’re 50 or older (up to the age of 75).
But from 1 July this year, these contribution caps will be reduced. The most you’ll be able to contribute is $25,000 a year, no matter what age you are. This concessional contributions cap will be the same whether you’re under or over 50.
Also on 1 July, the threshold for the additional contributions tax is going down from $300,000 to $250,000.
From that date, if your combined income adds up to more than $250,000, you’ll need to pay an additional 15% tax on your pre-tax concessional contributions.
Concessional contributions may be an important part of your retirement strategy.
So if you’re currently contributing up to the cap of $30,000 or $35,000 – it’s a good idea to come and see me so we can discuss your options for boosting your super once your cap goes down.
Earlier I mentioned that you can’t make any more non-concessional contributions once your total super balance hits $1.6 million. This figure of $1.6 million also plays a part in one of the other upcoming super changes.
From 1 July, a new ‘transfer balance cap’ will be introduced. This will limit the amount you can have in the tax-free pension phase of your super to $1.6 million.
So if you’re planning to set up a pension from your super so you can draw an income stream, you can only use a maximum of $1.6 million to set up the pension.
It’s important to note that this cap won’t affect how your pension is taxed. The income you receive will still be tax-free if you’re over 60. The tax treatment of income streams can be more complex if you’re under 60, but as I said, it shouldn’t be affected by this change.
But the transfer balance cap doesn’t just apply to new pensions. Even if you’re already drawing a pension as an income stream, from 1 July you’ll need to make sure your total balance in the tax-free pension phase isn’t higher than $1.6 million.
If it is, you’ll have to move any excess amount back into the accumulation phase of your super or withdraw the funds from the superannuation system. If you choose to move the excess back to accumulation phase the earnings will be taxed at 15% rather being tax free in pension phase.
If you don’t move the excess out of the pension phase before 1 July when the new transfer balance cap takes effect, tax penalties may apply. Plus, the Tax Office will require you to remove the money anyway. So it’s really important to take action before 30 June if you think you might be impacted by this rule.
If you have an SMSF or a wrap account, you’ll also need to decide which investment assets to keep in the pension phase and which ones to transfer back into the accumulation phase. There are different tax implications, which I’ll talk about in a minute.
If you’re nowhere near having $1.6 million in your super – then don’t worry, this won’t affect you. But if you’re over or near this cap, then come and talk to me.
Also, if you and your spouse together are over the $1.6 million mark, or you have a large insurance policy held in super, you might also need to come and see me to review your super estate planning. This is to make sure your estate plan takes into account the new $1.6 million cap.
It’s also worth noting that if you have a defined benefit pension or term-allocated pension, different rules will apply. You generally won’t be required to remove any amounts over the $1.6 million limit, but you might have to pay higher tax on the pension payments instead. If you fall into this category, I can talk you through your options.
OK, now we’re going to talk about some of the tax implications around transferring assets between the pension phase and the accumulation phase of your super.
When you sell an asset for more than what you bought it for, you make what is called a capital gain. You then have to pay capital gains tax on the amount of profit you make from the sale.
For self-managed super funds, wrap accounts and some other types of super funds, the capital gain also refers to part of the return you get on an investment.
So let’s say you have an SMSF or wrap account. You’re currently drawing a pension from your super and you have more than $1.6 million in the pension phase.
That means you have to move some of your pension assets back to the accumulation phase by 30 June. Then, down the track if you decide to sell one of those assets, you’ll have to pay capital gains tax on the profit you make.
Normally in this situation, you’d have to pay tax on any gains the asset made during the whole time you owned it – both in the pension phase and the accumulation phase.
The good news is, the government will provide capital gains tax relief for any assets you transfer out of the pension phase before 1 July.
This means that if you sell the asset down the track, you won’t get taxed on any gains the asset earned while it was in the pension phase. You’ll only be taxed on gains made once you transferred it back to the accumulation phase.
In other words, you’ll basically be able to ‘reset’ the cost of the asset – so it’s the same as if you sold the asset and then bought it again for its current market value.
That way, when you sell the asset in the future, you’ll only pay capital gains tax on whatever value it gains in the accumulation phase, not the pension phase.
For example, imagine your SMSF owns a parcel of shares in a company, which you bought two years ago for $100,000. This asset is currently sitting in the pension phase of your super, as it underlies your pension income stream.
You then decide to move those shares back to the accumulation phase to get below the $1.6 million transfer balance cap.
Today, the parcel of shares is worth $150,000 – that’s its market value. You can now reset the value of the asset to $150,000, not the $100,000 you paid for it.
Let’s say that in a few years from now, you sell the asset for $200,000. So instead of your capital gain being $100,000, it’s only considered to be $50,000 – because you reset the value to $150,000 when you transferred the asset. So you only pay capital gains tax on the $50,000 it gained in value during the time it was in the accumulation phase, not the value it gained while in the pension phase.
And, if you have a transition-to-retirement income stream, you may also be able to get capital gains tax relief as well. I’ll talk about this in a minute.
Before you make any decisions around capital gain, bear in mind that not all assets are eligible and the rules are quite complex. So if the transfer balance cap rule is likely to affect you, I can talk you through your options.
Let’s do a quick recap of the changes to retirement income streams that we’ve looked at so far.
The new transfer balance cap puts a limit on how much you can have in the tax-free pension phase of your super. From 1 July, this will be capped at $1.6 million.
This rule also applies to existing pensions. So if you currently have more than $1.6 million in the pension phase of your super, you’ll need to move the excess amount back into the accumulation phase by 30 June.
If the balance in your pension phase is still above $1.6 million at 1 July, the amount will be required to be removed from the pension and you’ll be liable to pay a tax penalty.
If you have an SMSF or a wrap account and you move your assets from the pension phase back into the accumulation phase, you may be able to get capital gains tax relief from the government.
This means you can reset the cost of your asset to its market value at the time when you transfer the asset. Then, if you sell the asset in the future, you’ll only have to pay capital gains tax on the profit the asset makes after you transfer it.
If this applies to you, I can help you tailor the right strategy to take advantage of this tax relief.
Now that we’re on the home stretch, I wanted to talk about the upcoming changes to TTR pensions.
At the moment, it’s possible to start drawing a pension from your super while you’re still working.
As long as you’ve reached your ‘preservation age’ – which is the age you can access your super – but you’re under 65, you can set up a tax-free income stream from your super. This is known as a transition-to-retirement or TTR strategy.
While you’re transitioning to retirement, you could cut down your working hours and use a TTR pension to supplement your income.
Or else, you can keep working full-time while growing your super through salary sacrificing. In this case, a TTR strategy is a tax-effective way to boost your super in your final years of work.
SECOND TRANSITION
But from 1 July, any earnings on the assets that support a transition-to-retirement pension will no longer be tax-free. In other words, those earnings will be taxed at the same rate as the earnings on assets in the accumulation phase.
For that reason, these pensions won’t count towards the $1.6 million transfer balance cap we talked about before.
If you’re currently using or thinking about using a TTR income stream as part of your retirement plan, this strategy might not be as beneficial after 1 July as it is currently.
Instead, we might need to review your overall retirement plan. That way, we can see if a TTR strategy is still the best way to build up your nest egg as you’re winding down towards retirement.
As the assets used to pay a transition to retirement pension are becoming taxable from 1 July, capital gains tax may also apply to gains on these assets that accrued while in the tax-free pension phase. In this case, the government is also providing capital gains tax relief to these assets, similar to what I discussed around the transfer balance cap.
Let’s have a look at someone who will be impacted by this change.
So, here’s any example that illustrates how a TTR strategy might be impacted by the new rules.
Emily is 61 years old and she plans to retire at the age of 65. She earns $60,000 a year and has $250,000 in super.
SECOND TRANSITION
First up: if Emily doesn’t take out a TTR pension but she keeps salary sacrificing into her super for the next four years up to the concessional cap of $25,000, then her super will have grown to approximately $355,000 by the time she retires.
Now, let’s look at what happens if she uses a TTR strategy. If we optimise both the pension balance and payments to get the best outcome, we can boost Emily’s retirement balance by almost $26,000 by salary sacrificing up to her cap and then starting a transition-to-retirement pension to replace her lost income.
But after 1 July, two things happen. The investment earnings on Emily’s TTR pension start being taxed - and she won’t be able to salary sacrifice as mush due to the lower cap on concessional contributions.
As a result, the benefit of the strategy reduces by about $7,000. However, Emily is still $19,000 better off than if she hadn’t implemented the TTR strategy.
So is a TTR strategy still the best option for you after 1 July? It really does depend on your circumstances. While the benefits may be reduced, you still could end up with more in your super than if you didn’t take a TTR pension.
That’s why it’s so important to talk to me about your overall strategy and we can really consider all the factors to decide what’s right for you. There are other ways you might use a TTR income as well, like topping up your spouse’s super – which I’m going to talk about in a minute.
Let’s recap what we’ve discussed about transition-to-retirement pensions.
At the moment, any earnings you make on your investments supporting a TTR pension are tax-free. But this will change on 1 July – after that date, these investment returns will be taxed at the same rate as assets in the accumulation phase.
If you’ve already started a TTR income stream, you’ll definitely want to come and speak to me as soon as possible. We can discuss whether it’s worth continuing with your TTR strategy and how it will affect your overall retirement plan once the changes kick in on 1 July.
And remember, these changes don’t necessarily mean a TTR strategy no longer has any value. It really depends on your circumstances.
It might mean you won’t get quite as much in your super, but you could potentially still be better off than you would be if you didn’t touch your super until retirement – as we saw in the example with Emily.
If you have a superannuation wrap or an SMSF, transitional capital gains tax relief may also be available to allow you to reset the cost base. But the question of whether or not you should claim the tax relief will depend on your circumstances.
So if you’re currently drawing a TTR pension or considering using this strategy in the future, ask me to go through your options.
Lastly, here are a few other changes to super rules that might impact you.
One is around tax deductions for personal contributions. At the moment, there are strict criteria for who is eligible to claim a tax deduction – but these restrictions will be removed on 1 July.
So from that date onwards, if you’re eligible to contribute, you’ll be able to claim an income tax deduction for any personal contribution you make to your super, up to the concessional cap.
This makes it even more tax effective to invest in your super. For instance, if you get an unexpected bonus or you sell an investment asset, then you can contribute the proceeds to your super and claim a tax deduction for that amount at the end of the financial year.
Remember, these contributions will still be taxed at 15% and they’ll also count towards your $25,000 concessional cap. You’ll also need to lodge a deduction notice with your super fund before you do your tax return.
Some other conditions apply as well, so you should speak to me first if you’re planning to make a personal contribution.
Next up is the spouse contribution tax offset. Under the current rules, when you make contributions into your husband’s or wife’s super you get an 18% tax offset – up to a maximum value of $540.
This offset starts to be reduced if your spouse’s income is $10,800 a year or more – bit by bit until it cuts off altogether if your spouse earns above $13,800.
But the good news is that this threshold will go up from 1 July. That means you’ll still be able to get the 18% tax offset for spouse contributions if your partner earns up to $40,000.
You’ll be eligible for the full $540 if your partner earns under $37,000. It will start reducing if they earn more than that, up until it reduces to nil if they earn over $40,000.
Finally, from 1 July the current Low Income Super Contribution (or LISC) will be replaced by the low income super tax offset (or LISTO). This helps provide a super boost for low income earners.
If you earn less than $37,000, the government will pay a rebate to your super fund to match the 15% tax on your concessional contributions, up to a maximum of $500.
So, for example, if you are earning $25,000 a year and you contribute $1,000 to your super, this contribution would be taxed at 15% – or $150. But with the rebate, you’ll get a government contribution of $150 to your super, so that effectively you don’t have to pay any tax on your contribution
As I said, these reforms represent the biggest changes to super in the last decade. They’re likely to impact lots of Australians in many different ways.
Super rules are very complex, so it’s OK if you still have more questions – that’s what I’m here for.
The bottom line is that everyone’s situation is completely unique and some strategies might be better for you than others. So we might need to look at different aspects of your financial plan to see if you need to make any changes so you can get the most out of the new rules and achieve the retirement lifestyle you’re aiming for.
You shouldn’t be worried about the changes – but you do need to plan carefully for them. So in these last few months leading up to the 1 July deadline, make sure you book an appointment to come and see me. That way, when the time comes, you can be confident that your retirement plan is still track.
Does anyone have any questions?