What are advisers asking ahead of EOFY?

The superannuation guarantee and the COVID-related measure on minimum pension drawdowns are among the top enquiries by advisers this end of financial year.

Fielding over 2,000 queries from advisers each quarter, BT’s technical team said it had seen greater adviser focus on the downsizer contribution, as well as more complex tax and estate planning queries especially for self-managed super funds (SMSFs).

Business owners making Super Guarantee payments

BT’s technical team said advisers might wish to remind their business clients with employees that the superannuation guarantee (SG) would be increasing to 10.5% in the new financial year.

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Tim Howard, technical consultant at BT, said: “Furthermore, the $450 minimum threshold is disappearing. Currently, if an employee receives under $450 (before tax) in salary or wages in a calendar month, their employer does not have to pay the SG for them. From 1 July, employers must pay the SG regardless of how much employees are paid.”

Pension members

The team said some clients were wondering whether super-related policies introduced during the pandemic were still in place. The Federal Government had temporarily halved minimum drawdown amounts, so those who were in pension phase could choose to withdraw less of their retirement savings and keep a greater amount invested, while markets were volatile and interest rates were at historical lows. This policy had been extended to 30 June, 2023.

Superannuation members making personal contributions

To ensure personal contributions for clients aged 67 or over could be made, advisers should check clients’ eligibility to contribute, such as meeting the work test. In addition, prior to lodging their income tax return for FY2022, super members needed to submit a notice of intent to claim a tax deduction for the amount of the contribution with the trustee of their fund, and receive acknowledgement that the notice has been accepted.

“Another point to note is that many clients will have carry forward contribution cap space available, particularly since they can carry forward unused amounts from the previous three years into the current year. That means clients may be able to make extra concessional contributions, without having to pay extra tax,” Howard said.