In its pre-Budget submission, the Institute of Public Accountants (IPA) is pushing the government to review the “discriminative” ‘10 per cent rule’ which it says restricts Australians from making personal concessional contributions into their superannuation.
Currently, if a taxpayer earns more than 10 per cent of their total income from employment services, they are unable to make personal concessional contributions to their superannuation from other sources of income, the IPA stated.
IPA chief executive Andrew Conway said the 10 per cent rule is “unnecessary and inequitable” for a number of Australians.
“A taxpayer earning income from other sources who also works part-time to supplement their income is limited to the superannuation contributions made by their employer,” he said.
“For example, if a part-time worker is earning $15,000 but also earns income from other sources, the maximum concessional superannuation contribution will be $15,000 if he or she is able to salary sacrifice their entire employment income,” he added.
Mr Conway believes the 10 per cent rule only works to “discriminate” against the source of the contribution.
“We need to encourage Australians to prepare for their retirement and not deprive them of superannuation concessions,” he said.
“The IPA believes the source of the concessional contribution should not matter and this is one piece of legislation that should be repealed,” he added.
“Access to the concessional super caps should not discriminate based on individual circumstances.”
SUBSCRIBE TO THE SMSF ADVISER BULLETIN
23 Jun 2017Trustees reminded of ‘positive’ CGT news as EOFY loomsBy Katarina Taurian
23 Jun 2017SMSF practitioners told to reassure clients in 30 June lead upBy Miranda Brownlee
23 Jun 2017SMSFs warned on 30 June cut off for electronic transfersBy Staff Reporter
22 Jun 2017Westpac veteran and SMSF exec set to departBy Staff Reporter
22 Jun 2017ATO sets compliance targets for auditors in 2017-18By Miranda Brownlee
22 Jun 2017CGT relief still plaguing trustees, says former ATO execBy Miranda Brownlee
- view all
Trustees reminded of ‘positive’ CGT news as EOFY looms
A capital gains tax (CGT) issue that was causing confusion in the industry has been cleared up by the ATO, and professionals are being remin...read more
SMSF practitioners told to reassure clients in 30 June lead up
With the focus predominantly on super members with above $1.6 million, it may be worth practitioners informing clients unaffected by the ref...read more
SMSFs warned on 30 June cut off for electronic transfers
With a significant portion of Australians missing the 30 June cut off last year when making non-concessional contributions, Colonial First S...read more
- view all