​The major amendments to the Government's super reforms, announced on 15 September 2016, are summarised by SuperConcepts' technical team.

Feature

Replace the proposed $500,000 lifetime cap on non-concessional contributions with lower annual caps for non-concessional contributions – and only allow members with superannuation balances less than $1.6m to make non-concessional contributions.

How will it work?

• From 1 July 2017, the Government will lower the annual non-concessional contributions cap to $100,000, which is four times the annual concessional contribution cap. The three year bring forward amount will be reduced to $300,000 (three times the annual non-concessional cap) for individuals under 65.
• The $1.6 million eligibility threshold will be based on an individual’s balance as at 30 June the previous year. If the member’s balance at the start of the financial year (the contribution year) is more than $1.6 million, they will not be able to make any further non concessional contributions.
• Individuals with balances close to $1.6 million will only be able to bring-forward the annual cap amount for the number of years that would take their balance to $1.6m.
• Where an individual has not fully used their non concessional bring-forward before 1 July 2017, the remaining bring-forward amount will be reassessed on 1 July 2017 to reflect the new annual caps.

Feature

Defer commencement of carry-forward arrangements for concessional contributions.

How will it work?

• The proposed start date for this measure has now been pushed back 12 months to 1 July 2018.
• From 1 July 2018, the Government will help people ‘catch up’ their superannuation contributions by allowing individuals with account balances of $500,000 or less to rollover their unused concessional caps (for up to 5 years) to use if they have the capacity and choose to do so.

Feature

Retain the work test for members aged 65 to 74.

How will it work?

To view the article in full and read SuperConcepts' opinions on the changes, click here.

• As per the current rules, individuals aged between 65 and 74 will only be eligible to make personal super contributions if they meet the work test (that is, they work 40 hours within a 30 consecutive day period in the financial year the contribution is made).
• As per the current rules, spouse contributions will only be permitted if the spouse receiving the contribution is under age 70, and if aged between 65 to 69 they and meet the work test.
• No changes have been announced to the other superannuation reforms announced as part of the 2016 Federal Budget. These reforms, including the proposed introduction of a $1.6m transfer balance cap and removing the tax exempt status of income from assets supporting a transition to retirement income stream, remain as originally announced.

The information provided is general in nature and does not take into account your particular investment objectives, financial situation or insurance needs; we therefore recommend you seek advice tailored to your individual circumstances before making any specific decisions.  If you would like further information on these updates contact Cotter Financial Services on P: 07 3333 2610

Cotter Financial Services and its advisers are Authorised Representatives of Fortnum Private Wealth Pty Ltd ABN 54 139 889 535 AFSL 357306 Australia Credit Licence No 357306 trading as Fortnum Financial Advisers.

The information (including taxation) contained within this document does not consider your personal circumstances and is of a general nature only – unless otherwise stated. Dobbrick Financial Services strongly suggests that you should not act on it without first obtaining professional advice specific to your circumstances.

This article has been reproduced with permission from AMP.  For original source, disclaimers, author information and credits:- http://www.ampcapital.com.au/smsf-suite/articles/2016/september/summary-of-september-super-announements?utm_medium=email&utm_source=ampc&utm_campaign=smsf-news&utm_content=article3-headline​

With life being so busy it can be very easy to ignore your long-term financial plans, but we can’t stress enough, planning conversations today should be done early to create room for your future dreams.

So how can you make the most out of your personal or business situation?

‘Dare to dream’ and plan for the future – here are a few things to consider.

Women

Australian women are currently retiring with an average superannuation balance less than half of men’s. It’s often only the issue of inequality of pay between men and women that is in the spotlight, but the long-term effects of a pay divide translate into lower savings when it comes time for women to retire, and the results can be devastating.

We should pledge for parity and focus squarely on closing the gap between men and women, and consider our retirement and superannuation savings to be a priority. A low superannuation balance and reliance on the aged pension could see many older women in Australia living in poverty and we would like to see a change with women taking control of their finances.

Seeking expert financial advice now to plan on boosting your funds could make an enormous difference to the lives of many Australian women.

Lower Interest Rates

With interest rates expected to stay low for some time, having an appropriate plan in place as early as possible is a good idea for all pre-retirees.

This allows you to concentrate on the things you can control – such as increasing your contributions to super, paying off your mortgage or reducing your spending – all of which can help make a big difference to your income and expenses in retirement.

You may also need to adjust how you view risk, through increasing your allocation to growth assets, in order to give yourself a chance to generate enough income for a comfortable retirement. As always though, it must fit within your comfort zone.

Taking Care of Business

When you consider the pressures and demands of running a successful small business today, it’s no surprise that many become overwhelmed when they spend what little spare time they have looking at the financial planning side of their business.

Looking down the barrel of 2017, it really is an excellent time to consider working with a financial adviser to review your business’ financial plan. Here are two important areas to get you started:

‘Key Person Insurance’- many businesses have an owner or key employee on whom the ongoing success of the business strongly depends. Key person insurance is similar to personal life insurance, the only difference being that it is the business that takes out the policy and pays the premiums, not the individual.
If those within your business are covered by this policy and one dies or becomes disabled unexpectedly, your business will receive a lump sum payment that it can use as working capital, to help find a replacement or pay down any debts.

‘Business expense insurance’ This helps to protect your business by ensuring it receives an ongoing benefit for the period that you, or your key employees, may not be working, giving them time to focus on getting better and returning to work when they are ready.
The money received from business expenses insurance can be used to cover the ongoing people costs associated with running your business, like salaries and overtime. It can also be used to pay for regular operating expenses like rent, utilities, and your business lease agreement.

For financial planning assistance contact Cotter Financial Services on P: (07) 3333 2610

The information provided is general in nature and does not take into account your particular investment objectives, financial situation or insurance needs; we therefore recommend you seek advice tailored to your individual circumstances before making any specific decisions.

Cotter Financial Services and its advisers are Authorised Representatives of Fortnum Private Wealth Pty Ltd ABN 54 139 889 535 AFSL 357306 Australia Credit Licence No 357306 trading as Fortnum Financial Advisers.​