Government confirms plans for $3 million super cap
The Prime Minister has announced that the government will look to reduce superannuation tax concessions for individuals with balances above $3 million from July 2025.
In a press conference today, Prime Minister Anthony Albanese has announced that the government plans to introduce a new cap for super which would see the earnings on super balances above $3 million taxed at a concessional rate of 30 per cent, rather than 15 per cent.
The change is set to occur on 1 July 2025, just after the next Federal election.
Mr Albanese said the reform would “strengthen the system by making it more sustainable”.
“The savings that are made from this tax breaks will contribute $900 million to the bottom line of the forward estimates and some $2 billion when it is operating over the full year period,” he said.
“This proposed change does not change the fundamentals of our superannuation system, 99.5 per cent of people with superannuation will be unaffected by this reform. 80,000 people will be impacted by this,” sated Mr Albanese.
This latest announcement follows the release of the Treasury’s consultation on the objective of superannuation last week.
Treasurer Jim Chalmers said there was no plans at this stage for the $3 million cap to be subject to indexation.
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 also has broad business and financial services reporting experience, having written for titles including Investor Daily, ifa and Accountants Daily.