SUPERANNUATION CHANGES FROM 1 JULY 2013

There are a number of changes to the superannuation system which take effect from 1 July 2013 as follows:

  • Compulsory superannuation guarantee payments increase from 9% to 9.25% of ordinary times earnings
  • The maximum age of 70 years for super guarantee eligibility has been removed so all eligible employees over 70 years can continue to build retirement savings
  • New MySuper accounts are to be established with a business default fund for employees who do not choose their own super fund. MySuper accounts are a basic, low fee superannuation product.
  • The low income super contribution scheme commences where the government will contribute up to $500 extra into your super each year if you earn less than $37,000
  • The concessional contributions cap for 2013-14 is $25,000 per person
  • Self-Managed Super Funds (SMSF) are required to review their investment strategy regularly and to consider whether the fund should hold insurance for its members.
  • New penalties for SMSF’s for non-compliance and tighter regulations in respect of related party transactions