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Date of article: 17 June 2011
Last updated: 17 June 2011

Concessional superannuation contributions caps for individuals aged 50 and over from 1 July 2012 ($500,000 threshold)

Update: Consultation paper has been released. Update will follow after the Government formalise the rules.

What we know:

From 1 July 2012, individuals aged 50 and over with total superannuation balances below $500,000 will have a concessional contribution cap of $50,000 per financial year. Those with total superannuation balances of $500,000 or more will revert to concessional contribution cap of $25,000.

Year Under age 50 Age 50 and over - Super balance below $500,000 Age 50 and over - Super balance $500,000 or more
2011-12 $25,000 $50,000 $50,000
2012-13 $25,000 $50,000 $25,000

 

What's still being worked out:

The eligibility criteria is under consultation - the main focus being on designing the parameters of what is balances of less than $500,000 and whether or not to include those who have commenced drawdown.

The proposals / discussion points:

  • Whether or not to include those who have commenced drawing down on their superannuation - add back the drawdowns, not add back the drawdowns, exclude those who have commenced drawndowns from being eligible.
  • Ascertaining an individual's total superannuation account balance - date on which account balances will be assessed.
    Option 1: 30 June in the financial year preceding the year in which contribuitions are made (e.g. for the 2012-13 financial year, the date for assessing eligibility would be 30 June 2012).
    Option 2: 30 June two years prior to the end of the financial year in which contributions are to be made (e.g. for the 2012-13 financial year, the date for assessing eligibility would be 30 June 2011).
  • Assessing eligibility - whether an individual would be responsible for assessing whether or not they meet the superannuation account balance criteria or the ATO to provide an on-line superannuation account balance facility.

Source: Concessional superannuation contributions caps for individuals aged 50 and over, Consultation Paper February 2011

 

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