With the end of the 2023/2024 financial year fast approaching now is a great time to review your superannuation contribution strategy. With only a few months to go before all superannuation contribution caps reset we interviewed a few of our financial advisers to ensure you are in the know and can assess whether their top tips may be applicable to your personal situation.
Jez Azzopardi, Financial Adviser for Tribel in Melbourne, Victoria, suggests ‘Make sure you get your contributions into your superannuation fund well before the deadline of 30 June. Superannuation funds will do their best to accept your contributions during the last week of the financial year, but there are no guarantees! And if you miss the deadline there is nothing we can do to get the contribution added retrospectively.’
The non concessional contribution cap for the 2023/2024 financial year is $110,000 if your total superannuation balance is less than $1.9 million. Once you have a total superannuation balance above $1.9 million you are no longer eligible to make non concessional contributions unless you meet other eligibility requirements.[i]
Chatting to Lily Mo, Financial Adviser for Tribel in Sydney, New South Wales, she reminds us about the ‘Non Concessional Contribution Bring Forward’ strategy. ‘The government knows that we all have different levels of cashflow during various times of our lives, so it allows us to ‘bring forward’ a chunk of our non concessional contribution cap, if we meet certain criteria. Firstly, meeting the age requirement, generally speaking you have to be under age 75, but you get a small grace period after your 75th birthday. Secondly, you have to check what your total superannuation balance is! If it is under $1.68 million you may be able to contribute as much as $330,000.[ii] So if you have some spare money available that you want to set aside for retirement, this is the time to think about making a contribution that will count towards your retirement goals.’
Whilst discussing end of financial year contributions with Felix Norma, Advice Specialist for Tribel Advisory from Sydney, New South Wales he confirmed that ‘Everyone who is working and under the age of 75, can contribute up to $27,500 into their superannuation fund this financial year by using the concessional contribution cap. These contributions are often made by your employer, or you can make them yourself if you run your own business. The exciting thing is that if you have not received the full $27,500 by way of superannuation guarantee payments from work you can top up your contributions from your own money and may be able to save income tax along the way. Don’t forget to find out from your accountant and financial adviser how much you can still add, so you don’t breach your cap, and how to claim the tax deduction if you are eligible. There are a lot of steps you need to follow to be able to get the tax deduction applied. These include advising your fund you intend to claim a deduction and you will need to complete various forms.’ [iii]
Finally, we check in with Peter Scolari from Tribel Accountants to see if he has any last-minute tips. ‘Make sure you check if you are eligible to claim a tax deduction on more than the standard $27,500 concessional cap. Some clients can use the catch-up concessional contribution rules and reduce their taxable income significantly. Generally, they have to have a superannuation balance of under $500,000 and an unused amount of money available in their concessional caps from years gone by. Many of our clients have saved some serious money in tax this way. In the 2024/2025 financial year the amount of money you can contribute in this way will go up from $27,500 to $30,000.’
In summary, now is the time to complete a contribution health check! Superannuation will be one of your biggest assets and sets you up for the retirement you have always dreamed of. So why not schedule an appointment with your financial adviser or accountant before the end of the financial year to see if you can take advantage of any of the above strategies!Â
