The 2016 budget includes the biggest shake-up to Australia's superannuation system in years, designed to benefit lower income earners. New rules for the annual contribution cap mean people returning to work after time away can put more into their superannuation than the current $25,000 limit.
Last night, the Government delivered the 2016-17 Federal Budget, its last before a looming double dissolution election. Superannuation was a key focus of the Budget with the Government’s superannuation package being the most significant changes to superannuation since Peter Costello’s Simpler Super package was announced in the 2006-07 Budget, netting it approximately $2.9 billion over the forward estimate period.
The Federal Government’s decision to reduce the concessional contribution cap down to $25,000 is a backward step that will severely reduce the ability of people to save adequately for retirement.
SMSF Association CEO/Managing Director Andrea Slattery says this decision, when coupled with other flawed measures in the Budget, will send shock waves through an SMSF sector that was hoping the broad parameters of the system had been settled.