ICAA urges key superannuation policy changes
The Federal Government has been urged to consider providing wider access for tax deductions for personal superannuation contributions.
The recommendation is contained in the Institute of Chartered Accountants' (ICAA) pre-Budget submission in which the organisation argues that such deductions should be available to all employees who receive employer superannuation support.
The submission argues that the current so-called "10 per cent rule" means that only taxpayers who earn less than 10 per cent of their assessable income from an employer source can claim a tax deduction for personal superannuation contributions - meaning that it is actually only available to a relatively small number of people who are generally self-employed.
"However, employees who work for employers that allow them to salary sacrifice superannuation contributions effectively overcome this issue - that is, they can forego salary and wages to contribute tax-effective superannuation contributions up to the concessional cap," it said.
The submission said this meant employees whose employers did not allow them to salary sacrifice were disadvantaged because they were unable to make tax-deductible personal superannuation contributions.
It said Australians trying to save for their retirement should not be deprived of superannuation concessions by working for an employer who did not allow them to salary sacrifice into superannuation.
"In our view, it would be more equitable and efficient to permit employees to make personal concessional contributions in order to 'top up' their employer contributions," the submission said.
"We believe this policy would encourage people of all ages and wage levels to provide more for their retirement."
Originally published by SMSF Essentials.
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