Super, tax and aged care announcements
This year SuperGuide has been fortunate to have been included in Treasury’s media lockup for the Federal Budget. As such we have been able to scrutinise the budget documents before they were released at 7.30pm, which has enabled us to provide this budget summary earlier than previous years.
Overall the announcements are all welcome improvements to the super and retirement rules, particularly that 300,000 low-income earners will soon be eligible for the super guarantee for the first time. The removal of the work test will also allow older Australians to contribute more to their super.
There are enhancements for three existing home-related super policies. The amount releasable through the First Home Super Saver Scheme has increased from $30,000 to $50,000, the eligibility age for Downsizer contributions has been reduced from 65 to 60 and from next year you will be able to access advance lump sums through the Pension Loans Scheme. The addition of a guarantee against negative equity should also make the scheme more appealing and on a par with equivalent commercial products.
SMSFs have also been catered for through an amnesty on some legacy retirement income products and a relaxing of residency requirements.
From a tax perspective there is the extension of the low and middle income tax offset (LMITO) for 2021-22, increasing of the Medicare levy low-income thresholds and modernising of the individual tax residency rules.
The Government has also pledged $17.7 billion over five years for improvements in aged care, including 80,000 new home care packages, an increase in the time nurses and carers are required to spend with residents, and 33,000 new training places for personal carers.
Click the article below for more detail about all these announcements.
Next week in the May newsletter we will provide further analysis and reactions on the budget from leading super and retirement experts.