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Super strategies for end of financial year

Article By Janik Hrabovcak | | Financial Planning

Here are some options you could consider

Tax-deductible super contributions

You may be eligible to claim a tax deduction for your personal super contributions.

The current before-tax contributions cap is $25,000 per financial year. Any contributions made above these limits will attract additional tax.

However some of the things that you will need to take into consideration are:

  • your age, sources of income
  • the level of salary sacrifice and
  • certain other employer contributions made for you

Salary sacrifice to top up your super

Much the same as a Tax-deductible super contributions, however a salary sacrifice is an arrangement where part of your before-tax wage or salary is paid into your super account instead of being received as take-home pay. The tax you save depends on how much you earn.

Salary sacrifice contributions count towards your annual before-tax contributions cap of $25,000 per financial year.

However some of the things that you will need to take into consideration are:

  • how much you can afford to contribute to your super from each pay cycle?
  • Not all employers offer salary sacrifice.  Please talk to your employer to find out if they can set up salary sacrifice arrangements for you.

After Tax contribution

After-tax super contributions are made from money you have already paid income tax on and won’t be claiming a tax deduction on. The advantage of investing in a superannuation environment compared to outside super is that earnings within your super accumulation account are taxed at up to 15%, compared to your marginal tax rate which applies to investments you may hold outside of super.

The annual limit for after-tax contributions is currently $100,000 if your total superannuation balance is below $1.6 million. In certain circumstances, you may be able to bring forward three years of after-tax contributions into one year, contributing up to $300,000.

First home buyers

You may be able to make voluntary superannuation contributions to use towards a deposit for your first home under the First Home Super Saver Scheme (FHSSS). Voluntary contributions you make, plus associated earnings, can be accessed from 1 July 2018 subject to meeting eligibility criteria.

The total amount of contributions you can withdraw is capped at $15,000 a year (or a maximum of $30,000 in total).

Downsizer contributions

From 1 July 2018, if you are planning on downsizing your family home of ten years or more and are aged 65 or over, you may be able to contribute up to $300,000 from the sale proceeds to superannuation as a downsizer contribution.

Downsizer contributions do not count towards your before or after-tax contribution caps or caps on contributions for total superannuation balance.

If you wish to see advice, please contact one of our Altitude Financial Advisers.

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