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Higher contributions cap of $35,000 - 5th August 2013
On
1 July 2013, the concessional contributions cap increased from
$25,000 to $35,000 for individuals aged 60 years and over. The same
threshold will apply from 1 July 2014 for individuals aged 50 years
and over.
TIP: Eligibility for the higher cap depends on a persons age on 30 June in the previous income year. This means:
- persons who were aged 59
years or over on 30 June 2013 are eligible for the higher cap
in 2013-2014; and
- persons who will be aged 49
years or over on 30 June 2014 will eligible for the higher cap
in 2014-2015.
Under
the new cap, eligible individuals will potentially be able to claim
greater deductions for superannuation contributions, or
salary-sacrifice larger contributions. It is important to note that
this temporary concessional cap will cease when the general cap
reaches $35,000 through indexation (which is expected to be 1 July
2018).
TIP: Taxpayers aged 59 years or over on 30 June 2013 should consider reviewing their salary-sacrificing arrangements, deductions for personal contributions and transition to retirement pensions to take into account the higher concessional cap of $35,000 for 2013-2014.
