06 Mar Positive regulation updates
There have been some recent changes to superannuation rates and thresholds, as well as social security rates which may impact you.
Concessional Contributions Cap
The concessional contributions cap has remained at the $25,000 level since July 2009, when the rate was reduced from $50,000. The ATO has confirmed indexation of the limit to $30,000 for the 2014-15 financial year. Different contribution limits apply depending on your age as per the table below:
| Age | Under 50 | Between 50 and 60 | Over 60 |
| 2013-2014 | $25,000 | $25,000 | $35,000 |
| 2014-2015 | $30,000 | $35,000 | $35,000 |
This is especially good news for those earning high incomes that can afford to sacrifice a further $5,000, as the tax benefit of doing so could range between $950 and $1,575 for the year.
Non-Concessional Contributions Cap
Similarly to the concessional contributions cap increase, the ATO have indexed the non-concessional contributions (NCC) cap. From 1 July 2014, individuals will be able to contribute $180,000 per financial year into their super via a NCC, up from $150,000 in the current financial year.
| Cap | |
| 2013-2014 | $150,000 |
| 2014-2015 | $180,000 |
Social Security Rates
More than 3.6 million pensioners will receive an increase to their payments from 20 March.
The increases will help pensioners keep up with rises in cost of living expenses and are driven by the CPI increase of 1.9 per cent for the six months to December 2013.
Another increase will occur in September and reflect growth in the Consumer Price Index or the Pensioner and Beneficiary Living Cost Index, whichever is higher.
- Single age pensioners will receive an increase of $15.70 a fortnight,
- Couples will receive an increase of $23.80 a fortnight.
This means total pension payments for people on the maximum rate will be $842.80 a fortnight for singles, and $1,270.60 a fortnight for couples.
In addition, around one million allowance recipients will also benefit from increases to income support payments such as Newstart and Parenting Payment on 20 March.
Single recipients without children on the maximum rate of allowance will receive an extra $9.70 a fortnight. The maximum fortnightly rate will be $519.20.
Singles with children on the maximum rate of allowance will receive an extra $10.50 a fortnight. The maximum fortnightly rate will be $561.80.
Parenting Payment Single recipients will receive an extra $13.50 a fortnight. The maximum fortnightly rate will be $725.10.
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About Reuben Zelwer
Reuben Zelwer established Adapt Wealth Management in 2011 to help time poor clients achieve financial freedom. For over 15 years, Reuben has helped professionals, executives, business owner and those approaching retirement make the most of their circumstances by making good financial decisions. Reuben’s professional practice is complemented by substantial voluntary work, which has included setting up financial literacy and savings programs in the local community. |