SMSF trustees over 60 can potentially enjoy a significant boost to their contributions as a result of the budget measure allowing people aged 66 and 67 the ability to use the bring-forward rule associated with non-concessional contributions, a senior industry body executive has said.
During a 2019 Budget Update webinar, SMSF Association head of policy Jordan George noted real contribution gains can be made by trustees nearing or in retirement if they time their non-concessional contribution strategy correctly.
“Very much now you could be looking at someone in their 60s that could use the bring-forward rule at age 60, age 63 and age 66 to make $300,000 contributions [at each age],” George said.
“So you could get $900,000 into super in your 60s using non-concessional [contributions] and the bring-forward rule.”
Further, he pointed out an even bigger boost to superannuation contributions could be gained if the latest measure was combined with one announced in the 2017 budget.
“Other ideas we are seeing around include [the strategy of] using [the bring-forward rule] in combination with downsizer contributions, which don’t count as non-concessional contributions,” he said.
“So a couple could effectively at age 66 could make a $300,000 downsizer contribution each and also a $300,000 bring-forward contribution [each].
“So they’d have the opportunity as a couple of getting $1.2 million into super if they were willing to sell their property and be downsizing.”
He described this strategy as one producing an interesting outcome if the 2019 budget measure was to be passed.