Superannuation Deduction and Tax-Free Restructures

funder and associates superannuation and tax free restrictions

Superannuation Deduction Notice


For the many individuals claiming a superannuation deduction in their upcoming 2017/2018 tax returns, do not forget to provide notice to your superannuation fund!

From 1stJuly 2017 individuals up to age 75 can claim up-to $25,000 in income tax deduction for personal after-tax superannuation contributions.



All individuals under the age of 65 are eligible. Those aged 65 to 74 who meet the superannuation ‘word test’ (work for at least 40 hours in a period of not more than 30 consecutive days in the financial year in which you plan to make the contribution). For those aged 75, the contribution must be made no longer than 28 days after the end of the month in which you turn 75.

Older taxpayers are ineligible.



If the individual is under 18 at the end of the income year in which the contribution is made, they must derive income in that year from being an employee or carrying on a business.



The contribution must be made to a complying superannuation fund.


Tax-Free Restructures


Thinking of restricting your business but concerned about the tax consequences of doing so?

Small Business Entities (SBE’s with a turnover of up to $10 million including the turnover of connected entities and affiliates) can now – subject to certain conditions – change their operating structure tax-free.

Having decided to go into business, one of the most important initial decisions is to choose which structure through which you will operate – sole trader, company, trust, partnership, or a combination of these. In making this decision, a number of factors need to be considered including minimising your tax liability, asset protection, access to equity capital, compliance costs, succession planning and more.

The most appropriate structure for a small business may change over time, or a new small business may choose an initial structure that it later finds to be inappropriate. For instance, for reasons of simplicity and minimisation of start-up costs, a number of small businesses commence as sole traders. However, as their business grows, they often wish to change to a more tax-effective structure (such as a trust). Aside from tax minimisation, restructuring into a more appropriate operating structure may help a business to:

  • Provide protection from personal liability,
  • Continue to develop and grow (e.g. taking on new business partners by changing from a sole trader to a company),
  • Minimise compliances costs,
  • Enhance business efficiency, or
  • Adapt to current conditions.

If at any stage like many business owners you are contemplating restructuring, an optional rollover is available (deferring any CGT liability and any income tax liability until the asset is eventually sold) where an SBE transfers an active asset of the business to another SBE as part of a genuine business restructure, without changing the ultimate economic ownership of the asset (i.e the people who own the business). The intent and effect of the new law is to make the change of structure CGT and income tax neutral for the transfer of CGT assets, trading stock, revenue assets and depreciating assets.


Would you like to know more? Contact us via our online form or get in touch today on 07 3357 3300.