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Increase on complaints for non-payment of life insurance by super funds March 5, 2014

Posted by Meike Suggars in Disability Insurance (TPD), Life Insurance, Personal Insurance, Superannuation.
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Life insurance payouts refused by super funds

As reported in Herald Sun 1 March 2014

 

Download the article here: Herald Sun article Super Headache dated 1 March 2014

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Wealthy super now taxed May 21, 2013

Posted by Meike Suggars in Superannuation.
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Prior to the May Budget, the Gillard government announced one of its changes to super for 2013: its intention to start taxing the super of Australia’s wealthy retirees.

In this case, “wealthy” is defined as those with superannuation earnings over $100,000pa.

Taxing super

Image courtesy Images_of_Money

It’s important we also clearly define “earnings” in this situation as being the income generated by the investments in a pension super fund (eg. dividends, interest or rent), NOT the pension income stream drawn from that fund by the retiree. This means any tax liability is paid by the super fund, not by the retiree. The income generated by the investments in an accumulation super fund (ie. the super funds of all working Australians into which super contributions are paid) is already taxed in this way.

 

To be generating $100,000pa investment income at 5% return, the retiree would need a super balance of $2,000,000. Another way to generate investment income of that amount is to sell assets within the fund that have generated a large capital gain.

Now, it’s only income above the $100,000 that is taxed so another way to look at it is the tax-free threshold increases to $100,000pa at retirement. That’s per person too so couple’s super could earn $200,000pa before tax was due. And the tax rate is 15% compared to 37% for a worker earning $100,000 in wages (excluding levies, 2012-2013 tax year).

So yes, the government is raiding the super pot because they’re spending too much, but in reality it’s a small portion of the population that will be affected. You’ll be one of those affected if:

  • you’re at retirement age (55) AND
  • you’ve converted your accumulation super fund into a pension super fund AND
  • you’re drawing a pension income stream from your super AND
  • the investments in your pension super fund generate over $100,000pa income

Don’t forget, it’s the super fund that pays the tax so the Aussie retiree can still pull their $100,000pa out of super tax free if they’re over 60 years old.

If you need more information about how super is taxed talk to your financial adviser or call Suggars and Associates. You can also read about the 2013 Budget here.

How to find your lost super March 3, 2011

Posted by Meike Suggars in Superannuation.
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Once upon a time, our employer got to choose the super fund into which they made contributions. This meant that each time we got a new job, we also got a new super fund!

Have you lost old super funds?

But things have changed and you now have the choice and so you can request your that employer pay your super into which ever fund you like.

Make sure all your old super funds have been consolidated into your primary fund (ie the fund you want contributions to go to) so that your super money is working as hard for you as possible. Having it spread around multiple funds means you’re paying multiple sets of fees, and not likely to be getting the best performance.

And if your old super fund has been transferred to an Eligible Rollover Fund, you’re likely to be paying much higher fees than normal.

To see if you’ve got any lost super, visit the government’s SuperSeeker website and enter your Tax File Number (TFN). You’ll then get a list of any super funds in your name.

 http://australia.gov.au/service/superseeker-lost-superannuation-search

Talk to your adviser or call Suggars & Associates to learn how you can roll all those old funds into your primary super fund, and really get your money working hard for your retirement.

The advice in this article is of a general nature only and does not take your personal circumstances into account. You should seek financial advice before making any investment or financial decisions.

Free Money from the Government! April 13, 2010

Posted by Meike Suggars in Superannuation.
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With the end of the financial year fast approaching, now is the time to review your tax position in order to take advantage of tax concessions offered by the government.

Co-Contribution – $1000

To help boost our superannuation balances, the government has a dollar-for-dollar matching scheme. If your taxable income plus the value of salary sacrifice contributions is below $61,920, you can receive up to $1000 from the government by making a $1000 non-concessional contribution (using your own after-tax money) to your superannuation.

Free money!

Get your free money!
Photo by Martin Kingsley

Low Income Tax Offset (LITO) – $1350

By salary sacrificing if you are employed or making concessional contributions if you are self employed, you can potentially reduce your taxable income to below $63,750 which then allows you to qualify for the LITO of $1350 or a portion of it.

This is the only government benefit that you can take advantage of by making concessional contributions with before-tax money to your superannuation.

Spouse Contribution Splitting – $540

If your spouse earns below $10,800, you may qualify for a $540 tax offset by making a non-concessional contribution of at least $3000 with your after-tax money to their superannuation fund. You can receive a portion of the $540 if your spouse earns up to $13,800.

To qualify for any/all of these tax concessions, superannuation contributions must be made before 30 June 2010 so they can be included in your tax return. Conditions do apply to all “free money opportunities” outlined here, so contact Suggars & Associates to learn more.

The advice in this article is of a general nature only and does not take your personal circumstances into account. You should seek financial advice before making any investment or financial decisions.