LISTO and tax deductions to benefit 4m
More than four million people will benefit from the superannuation changes coming into effect from 1 July 2017 either through the Low Income Superannuation Tax Offset (LISTO) or through tax deductions, according to a super body.
The Association of Superannuation Funds of Australia (ASFA) estimated that 63 per cent of the 3.1 million LISTO beneficiaries would be women, and around 15 per cent of LISTO recipients would be aged 30 to 39.
ASFA chief executive, Martin Fahy, said: “They can expect to receive around $260 on average, which is a good help because the average super balance of recipients is less than $50,000”.
LISTO will provide a refund of contributions tax for anyone earning up to $37,000, up to a maximum of $500.
Fahy said around 850,000 people would benefit from the ability to claim a tax deduction for personal contributions to super, around 10,000 people a year would benefit from the enhanced spouse contribution, and about 800,000 in a given year would be affected by other changes announced in the 2016 budget.
“Up to 400,000 people could be affected by the reduction in the concessional contribution cap to $25,000 a year and a higher rate of tax on contributions for those earning $250,000 or more,” he said.
ASFA estimated that around 110,000, many in self-managed super funds (SMSF), would be affected by the $1.6 million transfer cap.
The body also estimated around 170,000 people in Australian Prudential Regulation Authority (APRA) regulated funds with a transition-to-retirement pension and a further 100,000 with such a pension arrangement in an SMSF would be affected by the new rules.
Another 80,000 would be affected by the $100,000 a year cap for non-concessional contributions, down from $180,000 a year.
“…now is the time to chip in that extra money to your super before the new contributions caps apply on 1 July 2017,” Fahy said.
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