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The end of the financial year is fast approaching – and this year, there’s a new way to help you save on tax while boosting your super.
BSc. Econ, BCom, MBus
Authorised Representatives of Millennium Three Pty Ltd
ABN 61 094 529 987
AFSL 244252
The end of the financial year is fast approaching – and this year, there’s a new way to help you save on tax while boosting your super. By making an after-tax contribution to your superannuation before the end of the financial year, you could boost your retirement savings for the future – and claim a tax deduction now.¹ Here’s four things you need to know:
If you make super contributions from your after-tax income or savings, you may be able to claim them as a tax deduction and reduce your taxable income, while boosting your super.
The contribution will then be taxed in your super fund, generally at the concessional rate of up to 15% (high income earners may pay an additional 15% tax). This is instead of paying tax at your marginal tax rate, which could be up to 47% (including the Medicare levy).
Depending on your circumstances, this strategy could result in a tax saving of up to 32% – and help you retire with more.
To make a personal deductible contribution to super, you need to be under the age of 65, or 65 to 74, and have worked at least 40 hours over 30 consecutive days in the financial year you make the contribution.
To claim the super contribution as a tax deduction, you need to submit a valid ‘Notice of intent to claim a deduction’ form with your super fund, and receive an acknowledgement from them, before you lodge your tax return, start a pension or withdraw or rollover the money.
Remember, if you claim personal super contributions as a tax deduction, they count towards your concessional contribution cap, which is $25,000 in the 2018/19 financial year. It’s important you don’t exceed the cap, as penalties may apply. All employer contributions (including superannuation guarantee and salary sacrifice) and certain other amounts are also counted towards this cap.
If you’re thinking about investing more in super, we can help you decide whether making a personal deductible contribution is right for you. We can also help you assess all your options that may help build a healthy
retirement nest-egg.
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Perspective Wealth Management Pty Ltd
ACN 639 529 749
Trading as Luck Financial Group is a corporate authorised representative of Millennium3 Financial Services Pty Ltd
ABN 61 094 529 987 – AFSL 244 252
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