BIGGEST CHANGES TO SUPER IN A DECADE! DON'T MISS OUT: HOW TO CAPITALISE NOW BEFORE IT'S TOO LATE

The Biggest Changes to Super in a Decade – How to Capitalise Now!


Major changes to tax and superannuation were approved by the Government in early December 2016.  

These are the biggest changes in the last 10 years. They are significant.

Most of these changes will take place on 1 July 2017.
It’s wise to start planning ASAP.

There are a number strategies available to help you. Here are 3 key actions for you right now.


1. Maximise Super Contributions – Large amounts now for possibly the last time.

While you might not be flush with cash now and able to put large amounts into superannuation, it’s important that you’re aware of what is possible to maximise your super balance and how to reduce your tax.

The following changes occur from 1 July 2017:

The tax deductible super contribution cap decreases to $25,000 per year from $30,000 per year for up to age 49 or $35,000 per year for age 50 to age 75, after passing a work test if over 65.

The non-tax deductible super contribution cap decreases to $100,000 per year (provided your super balance is less than $1.6 million) from $180,000 per year.

You may have a once-off opportunity to make a non-tax deductible contribution of $540,000 before 30 June 2017 into super, depending on prior year contributions if any.

We need to meet and consider your overall personal and family circumstances, and then we can design for you the most tax effective super contributions you can make prior to 30 June 2017.


2. After you’ve maxed out your Super tax deductions – what else is there?

One of the most effective ways to reduce your tax is through super contributions.

The second is to invest in shares where you can benefit from dividends that are tax paid at up to 30% and you can invest small or large amounts of your money or from your equity in other assets.

You can use the equity in your home to increase your investment portfolio by taking out a equity release loan (which is not linked to value of of your share portfolio and so no risk of margin calls) ..

This strategy doesn’t apply to everyone – our Wealth Advice Team must pre-qualify you to ensure you will be better off from this strategy and will then provide you with a Statement of Advice which clearly outlines our strategies and advice for you.


3. Establish a “Lineal Descent Will” to keep your money and assets in your family

We believe a “Lineal Descent Will” is possibly the most important thing you can create for your family.

Rather than making gifts under your Will to individuals, you can make gifts to Lineal Descendant Trust (LDT) set aside for those individuals.

A lineal descendant testamentary trust is a trust established in someone’s will for the benefit of their lineal descendants – children and grandchildren, and so on down the lineal family tree.

Many parents are concerned that the inheritance they leave to their children could end up in the hands of a son-in-law or daughter-in-law if their child’s marriage breaks down. A properly drafted LDT can assist in keeping an inheritance out of the reach of the Family Court where a beneficiary is involved in a family law property dispute.

After your death, the individual you have intended to benefit will control the LDT set aside for them and will be able to use the assets in the trust as if they owned them. However, those assets will not be at risk should the individual divorce or have a separation.

Under the terms of a Lineal Descendant Trust :

  • the passing of the capital assets or proceeds is limited to the Will-maker's lineal descent;
  • income may be distributed to a broader range of beneficiaries, including in-laws (at the discretion of the trustee);
  • assets are protected from attacks against beneficiaries, whether from personal creditors or the Family Court;

We can help you by coordinating a tax effective Lineal Descent Will for you with our expert Estate Planning Lawyers.

This is vital – don’t delay in instructing us to set this up for you!