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Accountants need to brace for last minute requests from clients seeking advice in the lead-up to major superannuation changes coming into effect on 1 July.
The Institute of Public Accountants’ Tony Greco says key superannuation announcements in the 2016 budget will hit full swing by the end of this week, leaving some clients scrambling to take action.
“You look at the landscape this year and the showstopper would be superannuation which is the biggest change since 2007; all come into operation on 1 July so I suppose this is the last week where they can make a non-concessional contribution of a large size before the new rules kick into place,” Mr Greco said.
“These changes have been well communicated, but we are in the last week so this is probably the last throw of the dice for some people if they haven’t taken any action.”
From 1 July 2017, the non-concessional cap will be reduced from $180,000 to $100,000 per year, while the concessional contributions cap will be set at $25,000 across all age groups.
“The timing becomes an important issue too because it’s not the time that you make the payment, but it’s the time that is received by the fund. People have to be careful the money is received by the fund before the end of the financial year,” Mr Greco said.
“Those who are salary sacrificing for the concessional component, just because it is coming out of someone’s pay, it could be sitting in limbo before it moves across the super fund [and] the employer might not make the payment until July some time.”