Two parts of the Government’s superannuation legislation package has been passed by the Senate and the Bills are awaiting Royal Assent.
The passed Bills are the Treasury Laws Amendment (Fair and Sustainable Superannuation) Bill 2016 and the Superannuation (Excess Transfer Balance Tax) Imposition Bill 2016.
The Superannuation (Objective) Bill 2016 has not yet been passed by the Senate.
The changes which have been passed include:
- a $1.6 million cap from 1 July 2017 on the amount which can be used to start a pension from superannuation which is not a Transition to Retirement Income Stream;
- if a person has more than $1.6 million in superannuation across all accounts, the earnings on the excess will be taxed at the normal superannuation tax rate of 15%, rather than being exempt from tax as is currently the case;
- reducing the annual Concessional (tax deductible) Contributions cap to $25,000 from the 2018 financial year;
- reducing the Non-Concessional Contributions cap from 1 July 2017 to four times the Concessional Contribution cap (a total of $100,000);
- removing the tax exemption on the earnings of Transition to Retirement Income Streams from 1 July 2017.
