Changes to super contributions from 1 July 2014

How are the contribution limits changing from 1 July 2014?

Concessional contributions, which includes employer contributions, salary sacrifice and tax deductible contributions for the self-employed, currently has a cap of $25,000 per year for anyone under the age of 60 and $35,000 for anyone over 60.

From 1 July 2014, concessional contributions will increase to $30,000 for those under age 50. For anyone aged at least 49 on 30 June 2014 the contribution limited will be $35,000.

The next type of contribution is called a non-concessional contribution. This type of contribution is from after-tax (ordinary) money. The current limit is $150,000 per year or for anyone under age 65 who breaches the $150,000 a maximum of $450,000 can be contributed on a rolling three year period.

From 1 July 2014 this non-concessional contribution will increase to $180,000. Therefore, the rolling three year contribution limit increases to $540,000.

A number of strategies can be executed to take advantage of the changes and contribute significant amounts of money into a concessionally taxed environment of superannuation. 

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Thomas Jacks BCom (Acc), SMSF SpecialistTM, Adv. Dip F.S. (FP)
“I want to be able to assist clients with their investment and retirement planning by providing real strategy advice. It’s my aim to not only help my clients but to educate them by addressing the entire picture” Google Plus