Pittwater Life February 2017 Issue

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The CC cap is the limit

applicable to employer salary

sacrifice and tax deductible

contributions. At present

the maximum cap stands at

$35,000 for those who were

over 49 on 30 June 2016

otherwise it is $30,000. From

1 July the CC falls to $25,000

regardless of age.

The remainder of this

financial year therefore is a

final opportunity to make a

sizable deductible contribution

to super. With five months of

the financial year remaining

regular depositors to super

may wish to check their yearto-date

contribution levels

to ensure they will achieve

the goal, particularly where a

company payroll department

may need to be involved.

Similarly, those depositing

the maximum should be aware

of the lower threshold in the

2017/18 financial year as the

company payroll department

is unlikely to take the blame

for excess contributions in the

following year.

n Catch-up concessional

contributions

This change comes in from

1 July, 2018 but it should be

considered as part of the

amendments to concessional

contributions. Those with

balances under $500,000 will

be able to access a higher

annual cap and contribute the

remaining unused portion of

their CC cap on a rolling basis

over five years. Accrual of the

unused amount begins from 1

July, 2018. The thinking here is

that it will benefit people with

lumpy earnings or people who

move in and out of full time

and part time work. There is

also an opportunity for those

who may be contemplating the

sale of a capital gains taxable

asset to use this feature

to make a larger personal

deductible contribution.

n Changes to the nonconcessional

contributions

(NCC) cap

The NCC cap is the

limit applicable to nondeductible

superannuation

contributions. Currently, the

cap is $180,000 per annum

with the ability to make three

years ($540,000) of bring

forward contributions for

those under 65.

Over 65-year-olds can

currently contribute up to

$180,000 per year provided

that they have first passed a

work test of 40 hours (paid

employment) over a 30-day

period.

From 1 July, 2017 the NCC

will fall to $100,000 per year

with eligible persons being

able to access a three-year

bring-forward amount of

$300,000.

Alongside the introduction

of the lifetime pension transfer

cap, you will not be able to

make further NCCs if your total

superannuation balance from

the prior 30 June is greater

than $1.6 million.

Those with sufficient capital

and NCC caps can maximise

the opportunity by 30 June

using the bring-forward rule

to contribute up to $540,000

(per member), especially those

whose account balance is

already $1.6 million or more.

With changes this extensive

combined with the hard

deadline of 30 June, there

is urgency for trustees and

members to be on top of their

administration and lodgements

to have adequate time for

planning, consideration and

implementation of changes if

required.

Business Life

Brian Hrnjak B Bus CPA (FPS) LREA is a Director of GHR

Accounting Group Pty Ltd, Certified Practising Accountants,

Authorised Representative of Australian Unity Personal

Financial Services Ltd, ABN: 26 098 725 145, Australian

Financial Services Licence Number 234459 and licensee in

charge of AltRE Real Estate. Offices: Suite 12, Ground Floor, 20

Bungan Street Mona Vale NSW 2103 and Shop 8, 9 – 15 Central

Ave Manly NSW 2095, Telephone: 02 9979-4300, Webs: www.

ghr.com.au and www.altre.com.au Email: brian@ghr.com.au

These comments are of a general nature only and are not

intended as a substitute for professional advice. This article

is not an offer or recommendation of any securities or other

financial products offered by any company or person.

FEBRUARY 2017 51

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