Tag Archive for: Superannuation

Withdrawing your Superannuation Fund

Why it’s a bad idea to withdraw your entire Superannuation fund in one lump sum

Over the past two years, more superannuation is being withdrawn out of retirement accounts in lump sums rather than being taken out as a steady income stream.

Australian Prudential and Regulation Authority figures show in the 2014/15 financial year account holders withdrew a whopping $31.4 billion in lump sums as opposed to $29.5 billion being taken from accounts as a pension.

Also in 2013/14, lump sum withdrawals were higher than super savings taken as an income stream.

However, Australians are being warned that withdrawing your entire superannuation savings in one hit can be a bad financial move, particularly for those with larger balances.There are many things to consider before withdrawing all funds at once. Read more

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How the Budget will impact Independent Contractors and Businesses

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Author:  Raj Sesha, Director SDP Solutions and Tax Agent

Highlights for Independent Contractors and Businesses

With the Federal Budget 2014 announced, there was no doubt that we would all be affected in one way or another.  We all guessed right in what we were expecting… big cuts and changes.  Here we have focused the changes in the Budget that will affect businesses and independent contractors such as, tax, super and Medicare. The Key question that business will be asking, in my opinion is, what will be the impact on job growth and consumer sentiments as a result of this budget.

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Too much Super = Tax on Super

Extra Tax on Super

Superannuation plays an important part in securing your lifestyle in retirement.  Apart from the compulsory super contributions made by your employer (called ‘super guarantee’ or ‘SG’), you can contribute extra to your super fund at any time to help increase your savings for the future.

You can put in as much money as you like into your super, however there are limits on how much you can contribute before you pay extra tax.

The different caps depend on the type of contributions made into your super fund.  Read more

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Superannuation Changes

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As we all know from the 1st July 2013 the Superannuation Guarantee Rate will be increasing from 9% to 9.25%.  The increase in contributions will continue each year until reaching a level of 12% as outlined for the financial year 2019/20.

With many recruiters in speculation at the moment, as to whether or not to charge the increase back to their end client especially in terms of any existing contracts that go beyond 30 June 2012.  So with this in mind…What decisions are recruiters making to accommodate the increase?

 We would like to hear your thoughts and how you are planning to manage the change.

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Potential Tax on Super for those Earning over $300,000

The vast majority of taxpayers will be exempt from the upcoming budget superannuation changes, with Treasurer Wayne Swan to target those who earn $300,000 plus.

With the government desperate to find savings to fund its Gonski education and disability insurance reforms, it is understood the super changes – to be unveiled in the May 14 budget – will hurt fewer than 100,000 people.

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Prepare for Superannuation Changes

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The Federal Government is changing Super in Australia through the ‘Stronger Super” reforms.  These planned developments aim to make the super industry more efficient for employers, employees and super funds.  The changes mean that employers will need to plan, review and update their super processes.

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