CLIENT UPDATE 11 May 2011
Federal Budget 2011 - Superannuation Changes Superannuation did not feature prominently in this year’s Federal Budget. The reason is that many of the reforms proposed under the Cooper review and the Government’s response through Stronger Super are still being considered by both Government and industry. However, the following changes were announced: • For contributions made on or after 1 July 2011, taxpayers who for the first time breach the concessional contribution cap by up to $10,000 can request the return of the excess. It is not yet clear what is to happen to the 15% contribution tax in these circumstances. • For the 2011-12 year, the reduction in the minimum pension will be 25%. For the 2012-13 year and onwards, there will be no reduction in the minimum pension. • The concessional contributions cap for individuals aged 50 with less than $500,000 in superannuation will be $50,000 from 1 July 2012. • A deduction for investment losses against other income will no longer be available in relation to certain investments treated as trading stock (however, we expect that such losses can be carried forward as capital losses). • The superannuation co-contribution thresholds will not be indexed. • There will be enhanced reporting measures to assist with identification of lost super.
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