SMSFA gives thumbs up to work test changes
The SMSF Association has backed moves to change the age when the work test starts to apply from 65 to 67 as part of the government’s amendments to the SIS Regulations.
The amendments also include an increase in the age limit for spouse contributions from 69 to 74.
Both the work test and the spouse contributions changes have been registered and will take effect from 1 July 2020. Further, the changes were part of the government’s 2019–20 budget reform package.
SMSF Association chief executive John Maroney said the changes are extremely timely considering the market and economic fallout from the COVID-19 pandemic.
“It’s imperative that SMSF specialist advisers and trustees are alert to these amendments and incorporate them in their end-of-year planning,” Mr Maroney said.
“The amendments will give more flexibility to older individuals wanting to increase their contributions to superannuation to build adequate retirement savings.
“The work test has long been an area of regulatory burden, and increasing the age at which it applies will reduce red tape and compliance obligations for these individuals.”
Another budget measure — increasing the age limit for accessing the bring-forward non-concessional contributions cap for people aged 65 and 66 — is set to be implemented through amendments to the Income Tax Assessment Act 1997.
The amendments are currently before the House of Representatives and are expected to be passed before 1 July.