Government introduces bill to implement new budget measures for SMSFs
The government has introduced a major bill into Parliament that will implement the various changes to superannuation announced in the federal budget, along with changes to ECPI for SMSFs.
The Morrison government introduced into Parliament the Treasury Laws Amendment (Enhancing superannuation outcomes for Australians and helping Australian businesses invest) Bill 2021, which will improve flexibility for Australians preparing for retirement, support more Australians to own their first home and help Australian businesses invest.
The bill also reduces costs and simplifies reporting for SMSFs and small APRA‑regulated funds.
Superannuation Minister Jane Hume said the bill supports the repeal of the work test for non‑concessional and salary sacrificed contributions, which will be implemented through regulation changes the government intends to make before the end of the year.
“The legislation introduced today preserves the work test for personal deductible contributions made by individuals aged between 67 and 75,” she said.
“It will also make amendments necessary to allow eligible individuals to make non‑concessional superannuation contributions under the bring‑forward rule. This will improve flexibility for older Australians to contribute to their superannuation.
“Australians will be able to take advantage of these changes from 1 July 2022.”
In addition, the legislation reduces costs and simplifies reporting for superannuation funds by providing choice for superannuation fund trustees for the 2021‑22 income year onwards.
Trustees will now be able to use their preferred method of calculating exempt current pension income where the fund is fully in the retirement phase for part of the income year but not for the entire income year.
The eligibility age to make downsizer contributions into superannuation will also be reduced from 65 to 60 years of age.
This will allow more older Australians to consider downsizing to a home that better suits their needs, freeing up the stock of larger homes for younger families.
The government is also delivering on a key commitment in the Women’s Budget Statement by removing the $450 per month income threshold under which employees do not have to be paid the superannuation guarantee by their employer.
“This will remove a structural discrimination that has been part of the superannuation system since 1992, improve equity in the superannuation system and increase the economic security of women in retirement,” Ms Hume said.
“The maximum amount of voluntary contributions that people are able to release under the First Home Super Saver Scheme (FHSSS) will increase from $30,000 to $50,000, empowering more Australians to save effectively for their first home deposit.”
The bill and explanatory material are available on the Parliament of Australia website.
Tony Zhang is a journalist at Accountants Daily, which is the leading source of news, strategy and educational content for professionals working in the accounting sector.
Since joining the Momentum Media team in 2020, Tony has written for a range of its publications including Lawyers Weekly, Adviser Innovation, ifa and SMSF Adviser. He has been full-time on Accountants Daily since September 2021.