What the superannuation concessional contributions cap changes mean
The Federal Government has announced there will be an increase in the standard concessional and non-concessional contribution caps.
The changes announced by the Federal government will come into effect as of 1 July 2024.
The changes will see the standard concessional contribution cap increase from $27,500 to $30,000 and the non-concessional cap increase from $110,000 TO $120,000. The cap increases are in line with the statistical measure of average weekly ordinary time earnings.
It will also mean that the maximum value, under the non-concessional contributions bring-forward provisions, will increase by $30,000 changing from $330,000 to $360,000. It is important to note that people already in a bring forward period, will not see any benefit until their period is over.
The announcement came alongside the expected stage three tax cuts due to apply from 1 July 2024.
How to ensure you stay under the cap
Know what your concessional contributions cap is - it’s important to also be aware of any unused contribution cap amounts from previous years
Know what your super balance is
Be aware of all of the contributions made into your superannuation account, including both your contributions and those made by your employer. Pay extra attention if you have more than one job, or have multiple superannuation accounts. Remember concessional contributions made to to all your funds during a financial year are added together to count towards your concessional contributions cap.
Know when your employee pays super guarantee and other contributions.
In some cases, employers pay a cost on your behalf to your fund (administration fees and insurance premiums). These costs are included in your concessional contributions cap.
If you are eligible to claim a tax deduction for your personal super contributions, the amount allowed as a deduction is also included in your concessional contributions cap.
If you feel you are at risk of breaching the concessional contributions cap, you can reduce any before-tax voluntary contributions, or delay making any personal contributions.
Contact us today to learn more about our services and how we can assist you in managing your self-managed superannuation.
We are here to help
If you need further advice on this topic, please do not hesitate to contact our office on (03) 5445 4777 and one of our Accountants will be available to support you.
