Member Information Booklet - REI Super

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The following information is a general description of the tax treatment of superannuation accounts and superannuation pensions, and is based on our understanding of the tax laws as at the date of this Booklet. It aims to give you an overview only, assuming you are an Australian resident. If you are not an Australian resident for income tax purposes, different tax rules may apply. As the tax treatment of super can be complex and may change at any time, we recommend that you obtain advice from a licensed, or appropriately authorised, financial adviser about how the tax laws affect you. This particularly applies if you are considering making large super contributions or are considering retiring. You should also consider obtaining advice as you build your super, so that you can appropriately plan for your eventual retirement. your tax file number (tfn) Your TFN is important – if the Fund’s Trustee has your TFN, you’ll avoid paying extra tax on your contributions and your super payout, and the Trustee can accept your contributions. Your employer must pass your TFN to your super fund when you provide it for employment purposes. You don’t have to provide your TFN number to your employer. However, if the Fund Trustee does not have your TFN: > you will pay higher tax on any concessional contributions made for you > the Trustee will only be able to accept employer (including salary sacrifice) contributions made for you. No other contributions can be accepted, including non-concessional contributions and Government co-contributions > you may pay higher tax than necessary on your super payout. Any TFN information supplied to the Trustee will automatically be applied to all future contributions to and benefits paid from REI Super. If you do not have a TFN or require further information, contact the ATO on 13 10 20. taxes on superannuation accounts Superannuation is generally taxed at three stages: > Contributions paid into a super fund > Super benefits from a super fund > Investment earnings of a super fund. page 24 Summary of annual super contribution limits and tax treatment type of contribution Annual contribution cap* excess contributions tax Concessional $25,000 31.5% 2 Non-concessional $150,000 46.5% Non-concessional (3–year) 1 $450,000 46.5% TFN not quoted n/a 46.5% 1. Individuals under 65 may bring forward the non-concessional cap for the next 2 years (i.e. $450,000 over 3 years). The ‘bring-forward’ provision is automatically triggered if a person makes a non-concessional contribution in excess of $150,000 in a financial year. If you are age 65 or over, a limit of $150,000 applies for each financial year. You cannot bring forward contributions for future years. To make contributions after age 65, you must meet certain conditions set down in legislation. See the ‘Contributions’ section on page 4 for details. The limit is a limit per person, not a limit on the amount that can be made to each super fund if a person is a member of more than one fund. The Trustee can generally accept amounts up to these limits, but where any contribution, taken by itself, exceeds the limits, the Trustee is required to refuse to accept, or refund, the excess amount. The Trustee will continue to accept contributions which, by themselves, do not exceed the limits. This may mean that the total contributions received for you during a financial year will exceed the limits, and you may be liable for additional tax. It is your responsibility to monitor contributions made during each financial year. 2. Excess concessional contributions tax of 31.5% is levied on the individual (on top of the original 15% contributions tax paid by the Fund). The ATO will determine whether you have exceeded the limit and whether you are liable for any additional tax. If additional tax is payable, the ATO will issue a tax assessment to you. You can either pay this additional tax yourself, or you can ask the Fund Trustee to pay this additional tax from your super account. If you have already paid the tax yourself, you can ask the Trustee to refund to you the amount paid, and this will reduce your super account accordingly. If REI Super pays this additional tax to you or the ATO, a Withdrawal fee will apply (see ‘Fees and costs’ on page 19 for details).
tax on contributions From 1 July 2007, super contributions are classified as either ‘concessional’ or ‘non-concessional’. Concessional contributions Concessional contributions include superannuation guarantee (SG) contributions, salary sacrifice contributions, any extra employer contributions, and contributions for which a tax deduction is claimed. Concessional contributions may also include certain other amounts allocated by the Trustee, certain contributions made by other people (except the member’s spouse or employer) for the member, and some parts of an employment termination payment that you have received from an employer and rolled over. Concessional contributions up to an annual limit are taxed at 15%. Note that it will only be possible for the Trustee to pay or refund this tax up to the amount in your super account. Any concessional contributions over the limit will also count towards the limit on non-concessional contributions – see ‘Non-concessional contributions’ below. non-concessional contributions Non-concessional contributions include contributions made from your after-tax salary, spouse contributions made for you, certain amounts allocated by the Trustee, and any concessional contributions over and above the concessional contributions limit. Non-concessional contributions up to $150,000* are generally tax-free. * The non-concessional contributions limit is six times the level of the $25,000 concessional contributions limit, and will increase as the concessional limit moves with indexation. The ‘bring-forward’ limit is three times the non-concessional contributions limit that applies in the first year you elect to bring forward contributions. obtain advice Since the rules in relation to maximum contributions can be complex, and could have an important financial impact on your circumstances, we strongly suggest you obtain professional advice, such as from your REI Super Licensed financial planner, if you think these limits may apply to you. you’ll pay tax if you exceed the annual non-concessional limit If non-concessional contributions exceed these limits in total, any excess contributions will be taxed at 46.5%. The ATO will determine whether you have exceeded the limits and whether you are required to pay any tax. Any tax payable will be your responsibility, and you must nominate a fund to release money from your super account to pay the money either as tax to the ATO or to you if you have already paid the tax yourself. If you nominate REI Super, your account balance will be reduced to take account of any tax paid. When REI Super pays this additional tax to you or the ATO on your behalf, a Withdrawal fee of $90 will apply (see the ‘Fees and other costs’ table on page 20). page 25 tax on benefits You may have to pay tax on your super payout when it is paid from REI Super. The actual amount of tax depends on: > your age when you leave the Fund > the type of payout, and > certain other factors. You should obtain advice from a licensed, or appropriately authorised, financial adviser if you are unsure of what tax you may have to pay. your lump sum payout and tax The tax payable on lump sum super benefits (for reasons other than death) depends on your age and the different components that make up your payout. Lump sum benefits after age 60 You pay no tax on lump sum benefits after age 60. Lump sum benefits before age 60 Your lump sum payout will be made up of two components: > a tax-free component – this generally comprises your personal after-tax contributions, spouse contributions and an amount that represents the portion of your benefit built up before 1 July 1983. A higher tax-free amount may apply if you are totally and permanently disabled. You pay no tax on this component; and > a taxable component – this is your super payout, less any tax-free component. If you take your super payout after you reach your preservation age but before age 60, you pay no tax on the first $175,000* of this component and 15%^ tax on any amount over $175,000. If you take your super payout before you reach your preservation age, you pay tax at 20%^ on your total taxable component. Higher tax rates will generally apply to preserved or restricted non-preserved super benefits to a temporary resident who has permanently left Australia. * Applicable for the 2012/13 financial year. The limit is indexed from 1 July each year to Average Weekly Ordinary Time Earnings (AWOTE). ^ Where applicable, the Medicare levy is also payable.
Page 1 and 2: ei Super elite member information b
Page 3 and 4: 1 About REI Super & REI Super Elite
Page 5 and 6: 2 How super works 2 How super works
Page 7 and 8: merge your super accounts with rei
Page 9 and 10: estrictions on cash payments Genera
Page 11 and 12: what are the benefits of being a me
Page 13 and 14: investment options REI Super Elite
Page 15 and 16: 5 How we invest your money 5 How we
Page 17 and 18: investment managers The investment
Page 19 and 20: ei Super elite diversified investme
Page 21 and 22: 6 Fees and costs 6 fees and costs I
Page 23 and 24: example of annual fees and costs fo
Page 25: 7 How super is taxed 7 How super is
Page 29 and 30: 8 Insurance in your super Automatic
Page 31 and 32: Additional cover The maximum amount
Page 33 and 34: ‘dependant’ means a spouse and
Page 35 and 36: elite members fixed Cover rate of P
Page 37 and 38: when does cover end? Your insurance

Member Information Booklet - REI Super

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