POWERED BY MOMENTUM MEDIA
ASFA encourages maximising tax returns through super
The Association of Superannuation Funds of Australia (ASFA) has urged Australians to invest their tax returns in super, saying that taking advantage of compound interest and tax deductions will reward them in their retirement.
Each year Australians receive a total of $25 billion in tax refunds from the Australian Tax Office. ASFA said that the best way to maximise returns from this is by investing it in superannuation, as it affords benefits from both compound interest and tax deductions.
Changes to tax law effective from 1 July 2017 make individual contributions to superannuation tax deductable, subject to an annual contribution cap. This means that it is now possible to ‘double up’ tax returns by using them to make a tax-deductible contribution to superannuation.
“As tempting as it can be to splurge your tax return on short-term indulgences, it really makes sense to set it aside for your future, via super,” ASFA chief executive officer, Dr Martin Fahy, said.
The benefits of compound interest also help maximise tax returns if they are invested in super. ASFA said that if a 35-year-old put their tax return of $1,400 into super each year, they would have an extra $65,000 by retirement at 67.
Fahy said that the magic of compound interest was compelling.
Recommended for you
The Future Fund’s CIO Ben Samild has announced his resignation, with his deputy to assume the role of interim CIO.
The fund has unveiled reforms to streamline death benefit payments, cut processing times, and reduce complexity.
A ratings firm has placed more prominence on governance in its fund ratings, highlighting that it’s not just about how much money a fund makes today, but whether the people running it are trustworthy, disciplined, and able to deliver for members in the future.
AMP has reached an agreement in principle to settle a landmark class action over fees charged to members of its superannuation funds, with $120 million earmarked for affected members.
TOP PERFORMING FUNDS
ACS FIXED INT - AUSTRALIA/GLOBAL BOND
Fund name
3y(%)pa
1
DomaCom DFS Mortgage
76.97 3 y p.a(%)
2
Global X 21Shares Bitcoin ETF
76.46 3 y p.a(%)
3
UBS Solactive Global Pure Gold Miners UCITS ETF Dis USD
51.13 3 y p.a(%)
4
Global X GlobalX FANG+ ETF
45.15 3 y p.a(%)
5
Select Baker steel Gold Institutional
43.78 3 y p.a(%)
