Simply put, superannuation (or super) is money you put in a super fund while you are working to provide income later in life when you retire. Given the average Australian can expect around 20 years of retirement, and the Age Pension is designed to provide only the most basic needs, the more you can save now the more ... Read more
Guide to transition to retirement pensions (TTRs or TRISs)
Transition to retirement income streams (or pensions) allow you to gradually draw on your super benefits while you’re still working and moving towards your retirement. They go by a variety of acronyms, including TTR and TRIS. For simplicity, we’ll use the TTR acronym in this article. There are different ways that ... Read more
Super concessional (before-tax) contributions: 2018/2019 survival guide
Note: This article explains the rules applicable to concessional contributions for the 2018/2019 year (and for the 2017/2018 year, and later in the article, also explains the rules applicable for the 2016/2017 year). Superannuation contributions can be divided into two types — concessional (before-tax) contributions ... Read more
Unrestricted access to super, sometimes
Q: I have been a member of my super fund from about 1993. I see from your 14 legal ways to withdraw your super benefits article, that I may be able to access my restricted benefit. You write: “If you’ve been a member of a super fund since before 1 July 1999, you can cash your ‘restricted non-preserved benefit’ (certain ... Read more
Superannuation Guarantee: Step-by-step guide for employers
An employer has key responsibilities in terms of paying superannuation contributions on behalf of employees. An employer must pay Superannuation Guarantee contributions on behalf of eligible employees. If an employer fails to pay these compulsory super contributions, or pays the super contributions late, penalties ... Read more
Salary sacrifice and super: A guide for employees and employers
Salary sacrificing superannuation, by making before-tax super contributions, is a popular strategy for employees on middle-to-high incomes. The deal is that you increase your superannuation balance while reducing the amount of income tax payable on your salary or wages. More specifically, by salary sacrificing super ... Read more
Superannuation Guarantee: Many Aussies miss out on SG increase
Now that we into our fifth financial year of a higher Superannuation Guarantee rate of 9.5%, you can expect some difficult conversations to continue between employers and employees as more salaried employees discover that the Superannuation Guarantee (SG) increase of 0.25%, which took the SG rate to 9.5%, does not ... Read more
Do I need to pay super for my 16-year-old employee?
I am a small business owner who currently employs a 16-year-old employee. She works a minimum of 20 hours per week and her gross income exceeds $450 per calendar month. Am I required to pay her superannuation? You will need to verify your SG responsibilities with the ATO (on 13 10 20) but the general rule is: if an ... Read more
Superannuation and employees: 10 facts about your super entitlements
If you work as an employee, and you satisfy certain minimum requirements, your employer must pay Superannuation Guarantee (SG) contributions on your behalf, to a super fund. Set out below are 10 of the most important SG facts that you need to know. Note: If you’re an employer, you can also refer to SuperGuide ... Read more
Tax-deductible super contributions: Claim no more than your income
Q: If I make a personal concessional payment of $25,000 (tax-deductible) into my super fund and my personal taxable income for 2018/2019 is $20,000, are there possible tax penalties because I’m claiming $5,000 more than my taxable income? I suggest you chat to a registered tax agent, typically an accountant to ... Read more
Does shift work count for SG entitlements and income protection insurance?
Q: I’m a shift worker and have a question about whether my ‘Super fund salary’ figure which my employer gives to my super fund should include both my base and shift loading salary. At the moment it only includes my base even though my employer does pay super for both my base and shift loading. What I’m concerned about ... Read more
Employees can now make tax-deductible super contributions
As an employee, the general rule when making super contributions is, you can take advantage of the concessional (before-tax) contributions rules by salary sacrificing, or by making tax-deductible super contributions. If you’re self-employed, you can take advantage of the concessional contributions rules by making ... Read more
Superannuation Guarantee: What hours does my employer have to pay super on?
Q: I am trying to find out on what hours my employer has to pay super. I get paid per hour plus over time, but it is a set roster of 12 hours per shift. Doing less is not optional so to me they are ordinary hours, not overtime, or is this a loophole for employers? Can you direct me to find out about this? Generally ... Read more
Fund choice: Can my employer insist I join the super fund they use?
Q: I am about to start a new position. I am 67 years old and have an SMSF. My new employer has said I must join the super fund they use and cannot use my SMSF as they have too many employees. It was my understanding I could have the Superannuation Guarantee paid to the super fund of my choice. Would you kindly let me ... Read more
Who can now make tax-deductible super contributions?
Note: Since 1 July 2017, all eligible Australians under the age of 75 can claim tax deductions for personal super contributions, subject to the annual concessional contributions cap. What this means is that, for the 2018/2019 year (and for the 2017/2018 year), and future financial years, employees can make ... Read more