SPAA urges concessional cap increase above $35,000

The SMSF Professionals' Association of Australia (SPAA) is calling for an increase in the concessional contribution cap above the current $35,000 to allow superannuation savers to contribute more.

SPAA wants the Coalition Government to increase the cap in a bid to make Australians self-sufficient in retirement.

"The recent increase from $25,000 to $35,000 was welcome but SPAA strongly believes the cap needs to be higher to allow superannuation savers to be able to make greater concessional contributions," SPAA CEO Andrea Slattery said.

"This is especially relevant to women and those with broken work patterns as a higher concessional cap will give them the chance to contribute more to superannuation at a time when they can afford it most."

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Under the current system, people aged 60 and over will be able to make up to $35,000 of concessional contributions to their superannuation in 2013-14, and from July 1, 2014, people aged 50 and over will also be able to contribute $35,000.

The decision, which was announced in April, became legislation in May this year.

Slattery believes the tax concessions for contributions are a vital part of the Australian superannuation system policy that leaves Australians with a reasonable amount for a sustainable retirement.

"The concessionally taxed contributions to superannuation give people the incentive they need to forgo current spending in favour for saving for retirement," she said.

She said the SPAA had been advocating for a higher contribution cap than the $25,000 limit since it was slashed to that level in 2009, particularly for those over 50. SPAA made submissions in 2011 that supported the introduction of a $35,000 cap.