How the budget will affect Superannuation…
This budget saw Superannuation get a bit of a reprieve from major policy change – a welcomed change from previous years. As well as the announcements noted below, there are some changes afoot for how ECPI is calculated and applied.
Superannuation ‘work test’ watered down & age limit for spouse contributions increased
|Date of effect||1 July 2020|
As previously announced, from 1 July 2020, Australians aged 65 and 66 will be able to make voluntary superannuation contributions (concessional and non-concessional) without meeting the Work Test. Currently, voluntary contributions can only be made if the individual has worked a minimum of 40 hours over a 30 day period (Work Test). Those aged 65 and 66 will also be able to make up to three years of non-concessional contributions under the bring-forward rule.
In addition, the age limit for spouse contributions will be increased from 69 to 74 years. Currently, those aged 70 years and over cannot receive contributions made by another person on their behalf.
Opt-in insurance delay
The Government will delay until 1 October 2019, the start date for reforms that ensure insurance within superannuation is only offered on an opt‑in basis for accounts with balances of less than $6,000 and new accounts belonging to members under the age of 25 years.
Defence Force members can stay in super fund after discharge
Eligibility to Australian Defence Force Superannuation Scheme (ADF Super) membership will be extended to allow ADF Super members to choose to remain contributory members after discharge.