In this webinar we will explore and explain some of the more beneficial superannuation strategies that you should be considering in the next 12 months. We will cover super strategies for members of all types of superannuation funds, including industry funds, retail funds and SMSFs.
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I enjoyed this Webinar, however, was left a little confused with the explanation of the recontribution strategy. The presenter contradicted himself WRT re depositing the funds back into Super as NCC when in pension phase.
We’re glad you enjoyed the webinar. To clear up any confusion, it is possible to implement a re-contribution strategy while in pension phase but the contribution(s) must be put into the accumulation phase.
For example, if your entire balance was $1 million and in fully in pension phase, it would be possible to withdraw $360,000 during 2024-25 and contribute that amount to a separate accumulation account, using the three-year bring forward rule. This assumes a bring forward period is not already underway and that the total super balance was below $1.66 million on the last 30 June.
Prior to the contribution, the balance of the accumulation account was zero. In an SMSF any contribution will automatically be allocated to the member’s accumulation interest as it is not possible to contribute to a pension. In an APRA-regulated fund, you would need to apply to open (or re-open) an accumulation account with your chosen fund to make the contribution to.
After the contribution is made, the balance of $360,000 in the accumulation account can be used to start a second pension. If this is done immediately (before any investment earnings accrue), this second pension will be made of 100% tax-free component.
Note the amount of $330,000 shown in the webinar for the contribution was the maximum permitted under the bring forward rule during 2023-24 when the non-concessional contribution cap was lower.
You can read more in our article and case study. The case study includes using the strategy during pension phase.
Best wishes
The SuperGuide team
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