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SUPERANNUATION CONTRIBUTIONS
From 1 July 2024
EMPLOYERS - SUPERANNUATION GUARANTEE
Employers usually contribute
up to 30 June 2024 - 11%, from 1 July 2024 - 11% of ordinary time earnings to your
superannuation fund and then claim a tax deduction.
Employees must be over 18 years old (75 year old age limit from 1 July 2016) and you pay $450 or more in salary or wages in a month.
Employees under 18 years old must also work at least 30 hours per week. Employers must make these payments on 28th day after each quarter or pay a superannuation guarantee charge which includes the 11% superannuation plus interest plus an ATO administration fee.
Ordinary time earnings:
Includes - ordinary hours of work, over-award payments, certain bonuses, commissions, shift-loading and certain
allowances.
Excludes - Unused sick leave, unused annual leave, unused long service leave, overtime payments or lump sum
payments relating to overtime and specific loading.
These are called concessional contributions.
The governments has announced that a low income superannuation support will be provided via a payment of up to $500 a year, meaning no effective tax is paid on compulsory super contributions for employees earning up to $37,000 per year.
SELF EMPLOYED SOLE TRADERS AND
PARTNERSHIPS
Self employed sole traders and partnerships can claim
a tax deduction up to $27,500.
These are called concessional contributions.
CONCESSIONAL CONTRIBUTIONS ANNUAL CAP
$27,500
Concessional contribution cap is $27,500
for all individuals.
Some individuals with a superannuation balance of < $500,000 may make additional pre-tax contributions where they have not reached their cap in the previous 5 years (from 1 July 2017).
Division 293 tax
Your superannuation fund pays a 15% contributions tax to the ATO for all concessional contributions. If your income is > $250,000 you will pay 30% contributions tax.
Low income superannuation support
Will be provided via a payment of up to $500 a year, meaning no effective tax is paid on compulsory super contributions for workers earning up to $37,000 per year.
EXCESS CONCESSIONAL CONTRIBUTIONS
If you exceed the concessional contributions cap, any excess concessional contributions will be included in your assessable income and taxed at your marginal tax rate, rather than the excess concessional contribution tax rate of 31.5%.
To reduce your tax liability, the ATO will apply a 15% tax offset to account for the contributions tax that has already been paid by your super fund provider.
You may elect to withdraw up to 85% of your excess concessional contributions from your superannuation fund to help you pay your income tax assessment.
EXCESS CONCESSIONAL CONTRIBUTION CHARGE
This charge is payable on the increase in your tax liability for the year you have excess concessional contributions.
The relevant charge period is calculated from the start of the income year in which the excess concessional contributions were made. It ends the day before the tax is due to be paid under your first income tax assessment for the year that includes the excess concessional contributions.
The ECC charge rates are updated quarterly
April - June 2024 7.34%
January - March 2024 7.38%
October - December 2024 7.15%
July - September 2023 6.90%
April - June 2023 6.46%
January - March 2023 6.06%
October - December 2022 5.31%
July - September 2022 4.00%
April - June 2022 3.07%
January - March 2022 3.04%
October - December 2021 3.01%
July - September 2021 3.04%
April - June 2021 3.01%
January - March 2021 3.02%
October - December 2020 3.10%
July - September 2020 3.10%
April - June 2020 3.88%
January - March 2020 3.91%
October - December 2019 3.98%
July - September 2019 4.54%
April - June 2019 4.96%
January - March 2019 4.94%
October - December 2018 4.96%
July - September 2018 4.96%
Non
Concessional Contributions Cap (NCC)
• a reduced annual
non-concessional contributions cap (NCC).
• eligibility changes referring to a client’s total
super balance and general transfer balance cap
• government co-contribution linked to the annual NCC
cap and/or total super balance.
T
previous financial year to be eligible to make NCCs in the
relevant financial year.
This
criterion is to be met in addition to the existing age and work
test requirements.
Eligibility changes Individuals must have a total super balance
less than the general transfer balance cap on 30 June of the
After 1 July 2023 year, the general transfer balance cap is $1,900,000.
NCC contribution
eligibility:
Clients under 65 are eligible to make NCCs at any time.
Clients who are 65 years of age or over at the time of
contribution are eligible to make NCCs if they are not yet 75
and have
met the work test.
2 Contribution can be made by member and must be
received by trustee no later than 28 days after the end of the
month
that the member turns 75.
1 Indexed in $110,000 increments in
line with the Consumer Price Index (CPI).
3 Gainfully employed
for at least 40 hours over 30 consecutive days during the
financial year.
We have clients from the following locations:
Brisbane, Albion, New Farm, Teneriffe, Newstead, Windsor,
Wilston, Bowen Hills, Wooloowin, Herston, Lutwyche, Hamilton, Eagle
Farm, Gordon Park, Fortitude Valley, Clayfield, Ascot, Hendra.
Morayfield, Burpengary, Caboolture, Bellmere, Wamuran, Narangba,
North Lakes, Mango Hill, Kallangur, Dakabin, Deception Bay, Bribie
Island, Elimbah, Kippa-Ring.
Disclaimer
The information provided in the above documents is not intended to
be, nor should it be construed as tax advice.
Any specific recommendation for a client can only be done after
their individual circumstances have been determined by David Douglas
Accountants.
We do tax returns for individuals, trusts, companies, partnerships, contractors, ABNs and sole traders.
Liability limited by a scheme approved under Professional Standards legislation