Specialist administration provider SuperConcepts has predicted some positive changes to the contributions rules will be included in the 2019 federal budget to act as a boost to the government’s chances of re-election in the coming months.
One area SuperConcepts SMSF technical services executive manager Mark Ellem has identified for potential change is the contributions caps for older Australians.
“For example, we may see a restoration of the $35,000 or possibly $50,000 concessional contributions cap for members over 50,” Ellem said.
“Prior to the 2017/18 income year, these higher caps were hugely popular as they gave individuals, who were approaching retirement, the flexibility of making larger concessional contributions at a time when they have the financial capacity to do so.”
According to Ellem, the government may also provide positive change for younger superannuants as well.
“To assist low and middle-income earners, the government may decide to restore the pre-2012/13 approach and match eligible personal contributions dollar for dollar up to a maximum co-contribution of $1000,” he said.
The rules governing this facility changed after the 2013 financial year whereby the government only contributed an additional 50 per cent to that of the individual to a maximum limit of $500.
The removal of the age and work test rules is a further amendment to the retirement savings system Ellem believes could be contained in this year’s budget.
This move was originally included in the super reforms of 2016, but was subsequently removed to facilitate the passage of the reforms bill through the Senate.
“Given the general popularity of this measure, and benefits of reduced complexity and red tape, we think it will be tempting for the government to reinstate this aspect of their super policy in this year’s federal budget,” Ellem said.
