Each time your employer pays your salary they also pay you superannuation (subject to eligibility determined by government regulations). This payment is called the Superannuation Guarantee (SG) and a scheduled increase to SG has been set for 1 July 2021, from 9.5% to 10%.
The ATO recently confirmed increases to the amount of money you can contribute to your super account each year using concessional and non-concessional contributions. These increases may boost the potential for you to achieve tax concessions through superannuation.
Concessional contributions, such as your SG payment (see above), any other employer contributions, or payments you make from pre-taxed income, are taxed, when deposited into your super account, at the concessional super tax rate of 15%. From 1 July 2021, the annual concessional contribution cap will increase from $25,000 to $27,500.
Non-concessional contributions are contributions made with after-tax money and are not taxed when deposited into your super account. From 1 July 2021, the annual non-concessional contribution cap will increase from $100,000 to $110,000.
The ‘bring-forward’ provision, which allows members to contribute their annual non-concessional amount as well as any unused non-concessional amount from the previous 3 years still applies.
If you would like more information on contributions and how you may benefit from the concessions available in superannuation, please call our smartCoach team on 1300 262 241.
Last year, in response to the COVID-19 pandemic, the government changed the minimum drawdown rates by 50% for people who held pension accounts. On 1 July 2021 this temporary measure will end, and normal drawdown rates will be reinstated.
These reinstated rates are:
If you’d like to make changes to your pension payment frequency and/or amounts or, you’d like more information about the minimum drawdown rates, please contact us on 1300 112 403 .
On 1 July 2021 the government will make adjustments to the limit on the amount of money you can transfer to a tax-free pension account. The cap of $1.6 million and will change to become an indexed amount of up to $1.7million.
If you would like to understand more about this change, please visit the ATO website or call our smartCoach team on 1300 262 241.
Please note that transaction processing will be put on hold from Wednesday 30 June 2021 to Tuesday 6 July 2021 (inclusive). The hold is to allow us to check and audit final unit prices which is an essential step in determining members’ account balances for 30th June 2021 benefit statements. The hold applies to all transaction requests including contributions, rollovers, investment switches, account balance and benefit quotations1, benefit/lump sum commutation payments, and online services.
Important cut-off dates for this financial year
To help us ensure that your account is up to date for the 30 June 2021 benefit statement purposes, we encourage you to get all requests2 regarding your account to us, together with the required documents, by Wednesday 23 June 2021. If you make a BPAY or EFT contribution, please check the clearance time with your bank to ensure your payment reaches our bank account by the 23 June 2021. Depending on the volume of requests received after 23 June, we cannot guarantee all will be processed prior to the start of the hold but we will make every attempt to do so.
While all contributions received up to and including Wednesday, 30 June 2021 will be reported to the Australian Taxation Office as 2020/21 financial year amounts for annual contribution cap, Government co-contribution, spouse contribution and other super rebate purposes, those not processed by the hold date will not appear on your 30 June 2021 benefit statement.
Once processing resumes on Wednesday 7 July, transaction requests not processed prior to the hold will be processed as quickly as possible in order of date / time received using the price applicable on the date of processing.
For more information about the annual transaction processing hold, please contact us on the following numbers: