Search Site

Build a super retirement

20th February 2012

When there is a chance to cut the tax bill, most of us want to take a closer look. By increasing your superannuation contributions now you may have a chance to build your retirement benefit and possibly cut your current and future tax bills.

Why? Because once you have turned 60, your super pension is tax-free, this allows you to put as much as possible into super while you still can.

If you already have more than $500,000 in your super and are over 50, this financial year may be your last chance to contribute up to $50,000. From 1 July 2012, it is proposed that the concessional contribution cap for those aged over 50 with more than $500,000 in super will be halved from $50,000 to $25,000, the same cap applying to the under 50s.

There are also potential tax savings from salary sacrificing. Even if you are not in pension phase, you will only pay 15 per cent contributions tax rather than your full marginal tax rate which may be up to 46.5 per cent.

BMO is a multifaceted business advisory firm delivering solutions for accounting and taxation, business growth, wealth creation, loans and leasing. Information in this article is general in nature and readers are advised to seek advice specific to their circumstances. Before making any financial or investment decisions, we recommend you consult a financial planner to take into account your particular investment objectives, financial situation and individual needs.

Principal Wealth Management Pty Ltd is a corporate authorised representatives of Charter Financial Planning Limited, ABN 35 002 976 294, AFS Licence No. 234665, member of the AMP Group.

Return to Newsletters & Fact Sheets