Smart super strategies for this EOFY
With June 30 fast approaching, it’s time to start thinking about your super for another year. We’ve put together five smart strategies that may benefit you now and help boost your super.
1. Add to your super and get a tax deduction
2. Get more from your salary or bonus via salary sacrifice to super
3. Convert your non-super savings into super savings
4. Get a super top-up from the government
5. Boost your spouse’s super and reduce your tax
The tax advantages of saving in super
Saving more in super can come with tax and other benefits this financial year – but that’s just the start.
Once money is invested in super, earnings are generally taxed at a maximum rate of 15% – instead of your marginal tax rate, which may be up to 47%.
This low tax rate may help you build up savings for your retirement.
When you do retire, you can also transfer your super into a ‘retirement phase’ pension. Here, you won’t pay tax on investment earnings and any pension payments you receive from age 60 are tax-free.
Tips and traps
Before you add to your super, keep in mind you won’t be able to access the money until you meet certain conditions.
There are caps on how much you can contribute to super each year. It’s important to take the caps into account, as penalties may apply if you exceed them.
Make sure any contributions you want to make this financial year are received by your fund before June 30. With electronic transfers, the contribution takes effect the day your super fund receives the money, not the day you make the transfer.
Other eligibility criteria and conditions (including timing requirements) may apply to these strategies. Further information can be found on the Australian Taxation Office website, ato.gov.au.
Getting advice
You’ll need to meet certain conditions before you can use any of these strategies. A financial adviser can help assess your eligibility for these strategies, explain the different options available to you in detail and help you decide which strategies are appropriate for you.
1. CGT may apply on disposal of certain non-super investments/assets.
2. Includes assessable income, reportable fringe benefits and reportable employer super contributions reduced (but not below zero) by any excess concessional contributions and assessable first home super saver released amounts. For the Government co-contribution, it is also reduced for allowable business deductions. Other eligibility conditions apply.
3. Includes Medicare levy.
4. There is a limit on the total amount that can be transferred to retirement phase in your lifetime. Generally, if you have never started a retirement phase income stream, this limit is $1.9 million in FY 2024/25 (subject to indexation).
Further information
For further information please contact us on 08 9481 3122, or email our advisers:
Joseph Miasi: Joseph@ultimumfinancial.com
Luke Watson: luke@ultimumfinancial.com
Manisha Bhudia: manisha@ultimumfinancial.com
Source: MLC
Ultimum Financial Pty Ltd is a Corporate Authorised Representative (No. 1289192) of Capstone Financial Planning Pty Ltd. ABN 24 093 733 969. Australian Financial Services Licence No. 223135. Information contained in this document is of a general nature only. It does not constitute financial or taxation advice. The information does not take into account your objectives, needs and circumstances. We recommend that you obtain investment and taxation advice specific to your investment objectives, financial situation and particular needs before making any investment decision or acting on any of the information contained in this document. Subject to law, Capstone Financial Planning nor their directors, employees or authorised representatives, do not give any representation or warranty as to the reliability, accuracy or completeness of the information; or accepts any responsibility for any person acting, or refraining from acting, on the basis of the information contained in this document.