A new Government and what that means in terms of policy changes to your finances

A new Government and what that means in terms of policy changes to your finances

The following is a summary of the Coalition’s policy commitments. Please note that all initiatives are proposals only and subject to the passage of legislation. Superannuation Delay in Superannuation Guarantee (SG) increase to 12% While the Coalition has stated that it is committed to increasing the superannuation guarantee from 9 to 12 per cent, it intends to delay the increase by freezing the SG rate at its current level of 9.25% for two financial years. As a result, the SG rate is not expected to reach 12% until 2021-22. Scrap the $500 low income earner superannuation contribution The Coalition intends not to proceed with the $500 low income earner contribution. Under existing legislation, a taxpayer earning less than $37,000 qualifies for a payment of 15% of their concessional contributions up to a maximum of $500. The payment is made to the taxpayer’s superannuation fund and is designed to offset the tax payable on the taxpayer’s concessional contributions. Review contribution caps and co-contribution The Coalition will revisit concessional contribution caps and incentives, such as the super co-contribution, once the Budget is back in strong surplus. Review penalties for breaches of contribution caps The Coalition will consult with key stakeholders in the superannuation industry to develop an appropriate process that addresses all inadvertent breaches of the contribution caps where an individual can show that their mistake was genuine and the error would result in a disproportionate penalty. Improving quality of superannuation fund member reporting The Coalition has stated its intention to improve the quality of information available to super fund members and employers so that they can make informed decisions when...