Bring-forward measure to be stalled until November, BT predicts
With the three sitting days for the Senate in October expected to be reserved for budget measures only, the bring-forward measure for over-65s is unlikely to be passed until at least November, says BT.
While Treasury Laws Amendment (More Flexible Superannuation) Bill 2020 passed the House of Representatives in late August, it remains stuck in the Senate.
Once legislated, the bill will allow eligible individuals to utilise the bring-forward rules up to age 67, currently 65, without satisfying the work test and without being treated as an excess non-concessional contribution.
BT head of financial literacy and advocacy Bryan Ashenden said there have been non-related amendments to the bill proposed by minor parties to increase the level of permissible concessional contributions per annum for people over the age of 65, and integrity measures around the recontribution of amounts withdrawn under the COVID-19 early access measure.
While Parliament will resume the week of the budget, with sittings planned for 6, 7 and 8 October 2020, historically these sittings days have been reserved for discussing budget-related measures only, Mr Ashenden said in a BT Technical Services podcast.
“So, the chances of other legislation progressing could be considered slim — although we must say not impossible,” he said.
“After the three days of budget sittings, the Senate is not due to reconvene until 9 November 2020, meaning the passage of the superannuation bring-forward changes will not occur for some time.”
Unfortunately, Mr Ashenden said this leaves advisers in a state of limbo.
“As always, you need to advise clients based on the law as it stands at the time, meaning for clients aged 65 or 66, you can advise them of their ability to make non-concessional contributions without the need to meet a work test as that change is now finalised, but those non-concessional contributions remain limited to a maximum of $100,000 per annum,” he said.
Miranda Brownlee is the deputy editor of SMSF Adviser, which is the leading source of news, strategy and educational content for professionals working in the SMSF sector.
Since joining the team in 2014, Miranda has been responsible for breaking some of the biggest superannuation stories in Australia, and has reported extensively on technical strategy and legislative updates. Miranda has also directed SMSF Adviser's print publication for several years.
Miranda also has broad business and financial services reporting experience, having written for titles including Investor Daily, ifa and Accountants Daily.