Budget 2016-17 announcements affecting Superannuation
The Government has announced a number of changes in the 2016-17 Budget. The Budget papers are available at budget.gov.au
Subject to being passed in Parliament most of the changes are scheduled to commence on 1 July 2017, and a number will have an impact on members of CSC schemes. The major changes include:
Introducing a $1.6 million superannuation transfer balance cap on the total amount of superannuation that an individual can transfer into retirement phase accounts. See Fact Sheet.
Requiring those with combined incomes and superannuation contributions greater than $250,000 to pay 30 per cent tax on their concessional contributions, up from 15 per cent. This extends the current treatment of people with combined incomes and superannuation contributions over $300,000. See Fact Sheet.
Lowering the superannuation concessional contributions cap to $25,000 per annum. See Fact Sheet.
Subject to being passed in Parliament introducing a $500,000 lifetime cap for non-concessional contributions from 3 May 2016. See Fact Sheet.
A number of similar changes will apply to defined benefit superannuation arrangements. See Fact Sheet.
Removing the tax exemption on earnings of assets supporting Transition to Retirement Income Streams from 1 July 2017 (income streams of individuals over preservation age but not retired). See Fact Sheet.
The Government will consult on these changes. We will provide further information on our member websites on these matters once further analysis has been undertaken.
The Government has also announced that PSSap membership eligibility will be extended to enable PSSap members to remain contributory members when they leave Commonwealth employment.