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Superannuation Reform Changes 2016/17

Discussion in 'General Property Chat' started by MTR, 22nd May, 2016.

  1. MTR

    MTR Well-Known Member Premium Member

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  2. S0805

    S0805 Well-Known Member

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    2.6 Tax deductions for personal superannuation contributions From 1 July 2017, the government will change the law to allow all individuals under age 75 to claim an income tax deduction for personal superannuation contributions. Individuals who are, for example, partially self-employed and partially wage and salary earners, and individuals whose employers do not offer salary sacrifice arrangements will benefit from the proposed changes. However, individuals that are members of certain prescribed funds would not be entitled to deduct contributions to those schemes (prescribed funds include all untaxed funds, all Commonwealth defined benefit schemes, and certain defined benefit schemes that choose to be prescribed). Under current law, a tax deduction for personal superannuation contributions is broadly limited to selfemployed individuals, and substantially self-employed individuals (i.e., those that satisfy the ‘10% test’).

    With above change in mind which will be a better strategy salary sacrifice or contributing after tax and claiming in tax...as its open to everyone now. OR its the same...

    e.g. 100K gross income and 30% tax

    1) Salary sacrifice 10k : Reduce taxable income by 90K and pay 15% tax on 10k sacrificed amount
    2) tax deduction 10k : receive 10K after 30% tax in pay, contribute that to super, Claim this 10k in tax return...hence taxable income is 90K....but does 10k gets taxed when it is being contributing in super....???
     
  3. Terry_w

    Terry_w Solicitor, Finance Broker, CTA Business Member

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    It would be the same I believe
     
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  4. JohnPropChat

    JohnPropChat Well-Known Member

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    From what I understood, yes it gets taxed in super. Doesn't work out to better or worse just more accessible to everyone