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Changes to contributions
Changes to how you contribute to your superannuation fund |
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On 1 July 2007, there were three primary changes to how you contribute to your superannuation fund:
1. The introduction of contribution caps on the amount and type of superannuation contributions.
2. The necessity to provide your tax file number (TFN) to your superannuation fund to avoid outcomes such as paying more tax.
3. Tax deductions for certain types of contributions.
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Caps on superannuation contributions
The Government has imposed caps on the amount of employer and personal contributions made to your superannuation fund each financial year. Excess contributions will incur additional tax.
Effective from 1 July 2009 the following caps apply:
- Non-concessional contributions are capped at $150,000 per year (or $450,000 over any three consecutive years if you are under 65). These are personal or spouse contributions for which you will not claim a deduction. Excess contributions will be taxed at 46.5 per cent (including the Medicare levy).
- Concessional contributions are capped for the 2009/10 financial year at $25,000, or $50,000 if you are over 50 years of age at any time during the year. These include employer and salary sacrifice contributions made on your behalf, and any personal contributions for which you will claim a tax deduction. Excess concessional contributions will be taxed at 31.5 per cent in addition to the 15 per cent contributions tax and will be counted towards the non-concessional contributions cap.
Providing your tax file number (TFN) to your superannuation fund
If your superannuation fund does not have your TFN:
- it will be unable to accept any personal contributions, and
- any concessional contributions will incur tax of 31.5 per cent (in addition to the 15 per cent contributions tax already payable on any concessional contributions).
Importantly, if you are under age 60 and you receive income payments or lump-sum benefits from your superannuation fund and the fund does not have your TFN, your benefit will be taxed at the highest marginal rate.
Act now to provide us with your TFN
For these reasons it is very important that AXA has your tax file number. To provide your TFN to your superannuation fund(s) held with AXA, simply call our Customer Service Centre on 137 292.
Tax deductions for eligible people
Self-employed people (and other eligible people) can claim a full deduction for personal contributions made before age 75. These will be treated in the same way as contributions made by employers for the benefit of employees. In addition, they will have access to the Government co-contribution scheme for any after-tax contributions.
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