As we draw closer to the end of the financial year on 30 June 2022 it is important to consider tax planning strategies as well as other tasks to undertake for your Superannuation.
Contributions
Super Guarantee
Employers and employees should note that from 1 July 2021 the super guarantee rates increased from 9.5% to 10%.
Concessional contributions
Concessional contributions cap for the 2022 FY is $27,500 and the deposits must be received into the Super Fund prior to 30 June 2022.
When making a member concessional (deductible) contribution, you must give your notice of intent to claim the deduction to your Super Fund before the earlier of when you lodge your tax return or the end of the next financial year.
Non-Concessional Contributions
The non-concessional contributions cap for the 2022 FY is $110,000 if your total super balance at the close of the previous financial year is under $1,700,000.
If you are under the age of 67 you can bring-forward three years’ worth of non-concessional contributions in the one financial year as detailed below:
| Total super balance at 1 July | Non-concessional contributions cap for the first year | Bring-forward period |
| Less than $1.48m | $330,000 | 3 Years |
| $1.48m – $1.59m | $220,000 | 2 Years |
| $1.59 – $1.7m | $110,000 | 1 Year |
| $1.7m or more | $0 | Not applicable |
A person between the ages of 67 and 74 must meet a work test to make non-concessional contributions and are limited to an annual cap of $110,000 with no opportunity to use the bring-forward rules.
PLEASE NOTE: From 1 July 2022 members will not need to pass the work test to make non-concessional contributions up to age 74. The maximum amount that can be contributed under the brought forward rules moves to $330,000 depending on similar eligibility per the above tiered balances. If you are in this age group it may be worth holding off any non-concessional contribution until after 1 July as no work test required.
Work test
If you are between the ages of 67 and 74 you will need to pass a work test to contribute into your Super Fund, this requirement means a person must work 40 hours in a 30 day period once in the financial year to be eligible to make the contribution.
PLEASE NOTE: From 1 July 2022 you will only need to pass the work test if you’re under 74 and you intend to claim a deduction for your member contribution. As mentioned previously, no work test is required in order to make non-concessional contributions if the member is under age 74.
Work test exempt contributions
From 1 July 2019 if you retire between the ages of 67 to 74 and have a total super balance under $300,000 you can make further contributions into a Super Fund in the next financial year without having to pass the work test.
PLEASE NOTE: From 1 July 2022 this exemption will likely become redundant due to the work test changes.
Catch Up Contributions
From 1 July 2018 if a person’s total super balance is under $500,000 they can utilise their prior year unused contributions cap (difference between cap and contributions actually made) and make a catch up concessional contribution into their Super Fund.
Downsizer Contributions
If you have sold your principal place of residence or a property which at one time was your principal place of residence you can make a contribution up to $300,000 into your Super Fund. To qualify you need to be over the age of 65 and held the property continuously for a minimum 10 year period.
PLEASE NOTE: From 1 July 2022 the age eligibility is moving from 65 to 60.
Government Co-Contributions
If you are a low or middle-income earner and make non-concessional (after-tax) super contributions to your super fund, the government also makes a contribution (called a co-contribution) up to a maximum amount of $500.
Low Income Super Tax Offset
Eligible individuals with an adjusted taxable income up to $37,000 will receive a low income super tax offset (LISTO) payment to their super fund equal to 15% of their concessional contributions from employment. Maximum offset is $500 and can be paid directly you if you’ve reached preservation age or are retired.
Spouse contributions
If your spouse’s annual income is $40,000 or less and you make a minimum contribution of $3,000 into their Super Fund you will be eligible to an 18% tax offset in your tax return.
First Home Super Saver Scheme
If you have never held property in your name you can make a voluntary contribution into your Super Fund up to an annual cap of $15,000 and a total of $30,000 to then withdraw to assist with the purchase of your first home.
PLEASE NOTE: From 1 July 2022 the maximum limit in relation to this scheme is moving from $30,000 to $50,000.
Pensions
Indexation of Transfer Balance Cap (TBC)
Currently, an eligible member can establish a new pension of $1,600,000 which is added to their general transfer balance cap which is plainly, the amount of monies allowed in pension phase.
From 1 July 2021 this cap increased by $100,000 for eligible members to $1,700,000.
Members who have previously used some of their general transfer balance cap will only receive a proportional increase based on the highest ever balance of your transfer balance cap between 1 July 2017 and 30 June 2021.
Annual Minimum Requirement
If you are in receipt of a pension you will need to ensure that you have withdrawn your annual minimum prior to 30 June 2022.
For the 2019/2020, 2020/2021 and 2021/2022 financial years there is a temporary halving of the annual requirement for account based pensions similar pension products.
The temporary minimum rates are detailed below:
| Age of Member | Percentage Factor |
| Under 65 | 2% |
| 65 – 74 | 2.5% |
| 75 – 79 | 3% |
| 80 – 84 | 3.5% |
| 85 – 89 | 4.5% |
| 90 – 94 | 5.5% |
| 95 + | 7% |
PLEASE NOTE: The government has extended the temporary halving measures into the 2022/2023 financial year.
Transition to Retirement Pensions
If you are in receipt of this type of pension you need to ensure you have not withdrawn over the maximum limit of 10% of the account balance at the close of the previous financial year
Investment Strategy
Trustees of Self-Managed Super Funds will need to ensure they have reviewed their investment strategy to ensure their current investment allocations agree, this is even more important given the market fluctuations with COVID-19.
Asset Valuations
Trustees of SMSFs need to ensure that their investments including real property are revalued at 30 June 2022 to assist in the preparation of the financial statements.
For property holdings, we would recommend a curbside valuation be completed which includes comparable sales data.
In House Assets
Trustees of SMSFs with in-house assets must ensure that the value of these assets remains under 5% of the total assets at 30 June 2022.
Related Party Transactions
Where an SMSF has dealt with a related party the Trustee must ensure that those transactions have occurred on an arms-length basis and if there’s been a deviation that rectification occurs prior to 30 June 2022. Common examples include commercial property where the tenant is a related party or where there is a loan to the SMSF in the form of a Limited Recourse Borrowing Arrangement.
Maximum Number of Members in an SMSF
This has increased from a maximum numbers of members from 4 to 6 from 1 July 2021.
For further assistance please contact Daniel Shaw, SMSF Specialist Adviser and head of Superannuation of this office who can assist with your enquiries.
The information provided does not constitute financial product advice. The information is of a general nature only and does not take into account your individual objectives, financial situation or needs. It should not be used, relied upon, or treated as a substitute for specific professional advice. We recommend that you obtain your own independent professional advice before making any decision in relation to your particular requirements or circumstances.