From 1 July 2017, there will be a $1.6m transfer balance cap on the total amount of accumulated superannuation an individual can transfer into the tax-free retirement phase. Subsequent earnings on balances in the retirement phase will not be capped or restricted. An excess transfer balance tax is payable if the cap is exceeded
From 1 July 2017, the threshold at which high income earners are liable for Division 293 tax will be lowered from $300,000 to $250,000.
From 1 July 2017, the annual cap on concessional contributions will be reduced to $25,000 for all individuals (currently $30,000 for individuals under age 50, and $35,000 for those age 50 and over)
From 1 July 2018, individuals with account balances of $500,000 or less will be allowed to make “catch up” superannuation contributions by allowing them to roll over their unused concessional caps from up to five previous financial years.
From 1 July 2017, the annual non-concessional contributions cap will be reduced to $100,000 (currently $180,000) and individuals with a superannuation balance of more than $1.6m will no longer be eligible to make non-concessional contributions. As is currently the case, individuals under age 65 will be eligible to bring forward three years of non-concessional contributions.
From 1 July 2017, a Low Income Superannuation Tax Offset will be available to individuals who earn an adjusted taxable income of $37,000 or less for their superannuation contributions (the tax offset will replace the Low Income Superannuation Contribution which ceases to apply after 30 June 2017).
From 1 July 2017, the requirement that an individual must earn less than 10% of their income from their employment related activities to be able to deduct a personal contribution to superannuation will be removed. All individuals under the age of 65, and those aged 65 to 74 who meet the work test, may claim a tax deduction for personal contributions to eligible superannuation funds up to the concessional contributions cap.
From 1 July 2017, eligibility for the spouse contributions tax offset will be extended to individuals whose spouses earn up to $40,000.
From 1 July 2017, the tax exemption on earnings in the retirement phase will be extended to products such as deferred lifetime annuities and group self-annuitisation products.
From 1 July 2017, the tax exempt status of income from assets supporting transition to retirement income streams (TRIS) will be removed. These earnings will be taxed concessionally at 15%. Individuals will also no longer be allowed to treat certain superannuation income stream payments as a lump sum for tax purposes.
From 1 July 2017, the anti-detriment provision which allows superannuation funds to claim a tax deduction for a portion of the death benefits paid to eligible dependants will be removed.
From 1 July 2017, the range of existing processes for the release of amounts from individuals’ superannuation using a release authority will be simplified and consolidated, as part of streamlining the administration of the Division 293 tax regime.