News updates

Concessional contribution caps halved as at 1 July 2009 

On 12 May 2009, the Federal Government proposed a number of key changes to super as part of its 2009/2010 budget. One of the major changes announced was the reduction in the concessional contributions cap, as detailed below. Other changes made with regards to super in the recent budget announcements can be found in the Super news section.

The pre-tax (concessional) contributions cap has been reduced from $50,000 to $25,000 for those aged under 50 from the 2009/2010 financial year. The transitional concessional contributions cap for those aged 50-74 (for the 2009/2010, 2010/2011 and 2011/2012 financial years) is $50,000 pa, which has been reduced from $100,000 pa. These concessional (pre-tax) contributions include:

  • Super Guarantee (SG) contributions made by the employer
  • any contributions that are made under a salary sacrifice arrangement, and
  • any personal contributions for which the employee has claimed a tax deduction.

Any amounts over the pre-tax contribution cap will be taxed at 46.5% (including the Medicare levy). The excess contributions are also counted towards the employee's post-tax (non-concessional) contributions cap. There have been no changes to the pre-tax contributions cap limit, which remains at $150,000 for the 2009/2010 financial year.

The legislation relating to Reportable Employer Super Contributions was recently passed, where employers who offer their employees salary sacrifice super arrangements or make additional employer contributions for their employees may need to report the additional amounts to the ATO for the 2009/2010 year.

For more information on contributing to your employee's super request a copy of our
Employer Contribution Kit. 

 More news can be found in Super news

Important information unless you hold an Australian Financial Services License (AFSL), or are an authorised representative of an organisation that holds an AFSL, you cannot recommend any financial products or give advice about any superannuation funds. Breaches of the relevant legislation could expose employers to hefty fines and/or imprisonment. Any person wanting advice about financial products should seek advice from an Australian Financial Services licensee or an authorised representative of a Licensee.