| Henry Tax Review: Changes To Your Superannuation
The Australian Government has announced changes to superannuation on the recommendation of the Henry Tax review 2010. The changes are;
• The Superannuation Guarantee (SG) rate will increase gradually to 12% by 2019-20 (which is currently at 9%). The first increase will commence on 1 July 2013 with an increase of 0.25%, as outlined in the following table;
Income Year
| SG Contribution Rate (%)
| | 2013 - 14 | 9.25 | | 2014 - 15 | 9.50
| | 2015 - 16 | 10.00
| | 2016 - 17 | 10.50
| | 2017 - 18 | 11.00
| | 2018 - 19 | 11.50
| | 2019 - 20 | 12.00
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• From 1 July 2012, the government intends to provide a co-contribution to the already existing concessional contributions made by or for the benefit of low income earners. The amount payable by the government will be calculated at the rate of 15% for each $1 of concessional contributions, with an annual maximum amount payable of $500 (not indexed).
• From 1 July 2012, people aged 50 or older with superannuation balances below $500K will be entitled to make concessional superannuation contributions of up to $50 000 without exceeding the cap. This will be a valuable additional concession for those individuals who, through broken work patterns or otherwise, have been unable to accumulate sufficient superannuation prior to age 50.
• From 1 July 2013, the superannuation guarantee (SG) age limit will rise from 70 to 75 years of age. This means that employee’s aged 790-75 will generally be eligible for SG contributions made on their behalf.
Company Tax Rate Reduction
The Australian Government has announced the following changes to the company tax rate;
• For eligible small business companies - the company tax rate will be reduced to 28% from 2012 -13 income year; and
• For other companies - the company tax rate will be reduced to 29% for the 2013 -14 income year, and then down to 28% from the 2014 -15 income year.
Capital Allowance Concessions For Small Business Assets
The Australian government has also announced the following changes to capital allowance concessions to small businesses (Starting 1 July 2012);
• An immediate write-off for assets valued at under $5000 (currently, an immediate write-off is generally available for assets valued at less than $1000); and
• For other assets (except buildings) can be depreciated in a single depreciation pool at a rate of 30% (currently small business assets can be allocated to two different pools, according to their effective life – eg. a general pool or a long-life pool).
ASIC Poised To Crack Down On Market Misconduct
The Australian government has proposed changes to the Telecommunications act 1979 to allow ASIC to intercept telephone and electronic communications of corporations and their officers who are suspected of insider trading.
Under the current proposal the pecuniary penalty for individuals and corporations would also be increased from $22 000 to $500 000 and 1 million to 5 million respectively.
Employee Superannuation Made Easy
The Australian government has introduced a free Small Business Superannuation Clearing House service to help reduce red tape and compliance costs associated with meeting superannuation guarantee obligations.
The service is designed for businesses with less than 20 employees and allows for all superannuation contributions payments to be made in one (1) easy transaction. To register your business for this free service please contact one of our financial consultants today.
We're Living Longer... How Much Will You Need In Retirement? At the moment life expectancy in Australia is 84 for males, and 88 for females. So if you intend retiring at 65 than you'll probably have to fund at least 20 years of retirement. At Fitzpatrick & Associates we have developed a six step superannuation test to calculate whether you're putting enough away to support the future you want. Everybodies retirement plans are different, and a superannuation plan that works for your neighbour may not be benefical to you. You may need to save more if you; plan to retire before 65, still have debts to pay off, want to travel or have extra expenses (such as health care). Introducing Our New 6 Step Superannuation Test At Fitzpatrick & Associates our 6 step superannuation test will calculate what income you require, evaluate your current savings and contributions, and develop strategies to make your retirement plan a reality. We are committed to helping you achieve your superannuation goals by educating, motivating, and guiding you to make the right financial decisions.
Recent changes to legislation have made it simpler and more attractive to arrange your personal insurances through superannuation. Insuring through your superannuation fund may have a number of benefits, including: - Tax-effectiveness: you may be able to pay for your insurances with pre-tax dollars via salary sacrifice contributions to your superannuation.
- Cash flow: premiums are paid from your superannuation fund so you are protected from any short-term cash flow difficulties you may experience
- Convenience: in most cases, you are automatically accepted for cover so do not need to undergo medical examinations.
You may need to consider the impact of these changes as part of your overall wealth protection planning and we believe the best way to do this is to sit down and discuss them with a qualified professional. If you have any questions or would like to make an appointment, please call on (02) 4627 1066 so we can offer advice on how this opportunity could help protect your lifestyle and your family from life's uncertainties.
If you are paying more than 6.74% for your home loan then you should call us. Your needs and situation are like no one else's. With so many new and different types of home loan products now available, a loan that suits your neighbour might not be appropriate for you. Let us help guide you to a loan that is tailored to your individual needs. Pushed for time Comprehensive Lending Specialists will meet you at a time that suits you - Whether it is after work or during your lunch break. We aim to make the process as flexible and easy going as possible. With you from Start to Finish From the moment you choose a mortgage or decide to refinance, we will be with you all the way to guide you through the entire process - from application to settlement and beyond.. Keep it Simple We keep it simple by completing all the necessary paperwork for you, running you through all the other costs like stamp duty and conveyancing - we even help you apply for the First Home Buyers Grant if you are eligible. And best of all - our professional service is free of charge to all our clients.
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