Retirement
Fresh super tax proposal gains pace
The Financial Services Council has joined calls for a super tax rebate to be introduced, as a former Association of Financial Advisers president makes headway with government.
Fresh super tax proposal gains pace
The Financial Services Council has joined calls for a super tax rebate to be introduced, as a former Association of Financial Advisers president makes headway with government.
In December last year, principal at Paramount Wealth Management, Wayne Leggett, said that instead of concessional contributions being tax-deductible, they should be subject to a tax rebate.
This week, the FSC said superannuation contributions should be taxed at an individual’s marginal tax rate with a 20 per cent rebate.
The FSC released modelling by PwC on Wednesday showing that a 20 per cent rebate on the marginal tax rates for super contributions would be budget-neutral.
However, the budget-neutral status of the proposal is dependent upon the superannuation guarantee following current legislation and rising to 12 per cent by 1 July 2021.
If the superannuation guarantee were instead frozen at its current rate of 9.5 per cent, there would be a decrease in tax receipts of less than $1 billion to $4 billion, according to the PwC modelling.
The change would see those on the highest marginal tax rate (45 per cent) paying 25 per cent on their super contributions, whereas those earning less than $37,000 a year would pay no tax.
Currently, all super contributions (up to the concessional contributions cap) are taxed at 15 per cent, with the exception of individuals who earn over $300,000 and who are taxed at 30 per cent.
Speaking to nestegg.com.au's sister publication SMSF Adviser, Mr Leggett said he recently met with Western Australia’s federal member for Swan, Steve Irons, to discuss the proposal.
Mr Leggett said Mr Irons, who is in “close contact” with Assistant Treasurer Kelly O’Dwyer, will be discussing the idea with government.
RELATED ARTICLES
Superannuation
Superannuation guarantee rate rises to 12 per cent as parental leave changes take effect
The superannuation guarantee rate has increased from 11.5 per cent to 12 per cent from Tuesday, with super contributions also being added to Commonwealth Parental Leave Pay for the first time. Read more
Superannuation
Rest's Sustainable Growth option achieves highest sustainability classification
Rest superannuation fund has achieved the highest sustainability classification for its Sustainable Growth investment option from the Responsible Investment Association Australasia. Read more
Superannuation
Aware Super slashes admin fees for retirees by up to 25 per cent
Aware Super has reduced administration fees for members with a retirement income account by up to 25 per cent and lowered the maximum annual fee. Read more
Superannuation
SuperAPI co-founder criticises Labor's superannuation tax as 'sneaky tax on young people'
The co-founder of SuperAPI has labelled Labor's proposed tax on superannuation balances above $3 million as a "sneaky tax on young people, tomorrow" disguised as a policy targeting wealthy retirees ...Read more
Superannuation
Election policies could reshape Australia's superannuation landscape, expert warns
Competing superannuation policies from Australia's major political parties could have significant implications for investors and retirees, according to a financial expert. Read more
Superannuation
Industry leaders weigh in on concessional super tax as Budget confirms $55bn investment
Changes to the taxation of superannuation earnings and contributions have drawn mixed responses from financial and payroll sector leaders, as the Federal Budget confirms over $55 billion in ...Read more
Superannuation
Call for indexation on super tax cap as $3m threshold draws criticism
A senior executive in the superannuation technology sector has criticised the Federal Government for failing to index the proposed $3 million superannuation tax cap, arguing the measure will unfairly ...Read more
Superannuation
Rest members back calls for fairer superannuation rules ahead of Federal Budget
Rest has called on the Federal Government to implement superannuation reforms aimed at improving fairness across the system, after member survey results showed strong support for a range of proposed ...Read more
Superannuation
Superannuation guarantee rate rises to 12 per cent as parental leave changes take effect
The superannuation guarantee rate has increased from 11.5 per cent to 12 per cent from Tuesday, with super contributions also being added to Commonwealth Parental Leave Pay for the first time. Read more
Superannuation
Rest's Sustainable Growth option achieves highest sustainability classification
Rest superannuation fund has achieved the highest sustainability classification for its Sustainable Growth investment option from the Responsible Investment Association Australasia. Read more
Superannuation
Aware Super slashes admin fees for retirees by up to 25 per cent
Aware Super has reduced administration fees for members with a retirement income account by up to 25 per cent and lowered the maximum annual fee. Read more
Superannuation
SuperAPI co-founder criticises Labor's superannuation tax as 'sneaky tax on young people'
The co-founder of SuperAPI has labelled Labor's proposed tax on superannuation balances above $3 million as a "sneaky tax on young people, tomorrow" disguised as a policy targeting wealthy retirees ...Read more
Superannuation
Election policies could reshape Australia's superannuation landscape, expert warns
Competing superannuation policies from Australia's major political parties could have significant implications for investors and retirees, according to a financial expert. Read more
Superannuation
Industry leaders weigh in on concessional super tax as Budget confirms $55bn investment
Changes to the taxation of superannuation earnings and contributions have drawn mixed responses from financial and payroll sector leaders, as the Federal Budget confirms over $55 billion in ...Read more
Superannuation
Call for indexation on super tax cap as $3m threshold draws criticism
A senior executive in the superannuation technology sector has criticised the Federal Government for failing to index the proposed $3 million superannuation tax cap, arguing the measure will unfairly ...Read more
Superannuation
Rest members back calls for fairer superannuation rules ahead of Federal Budget
Rest has called on the Federal Government to implement superannuation reforms aimed at improving fairness across the system, after member survey results showed strong support for a range of proposed ...Read more
