Superannuation changes in 2022

New legislation has recently passed under The Treasury Laws Amendment Bill 2021 which will see changes to the way those approaching retirement can increase their superannuation.

These changes include extension to the minimum age for downsize super contributions, changes to the work test and bring forward rules, and removal of the $450 superannuation guarantee support and are set to be implemented by the end of this financial year.

Downsize super contributions extended to 60+

If you’re downsizing your home, you will be able to make an after-tax contribution from the sale of the property into your superannuation.

From 1 July 2022, the minimum age to make a downsizer contribution will reduce from 65 to 60. The maximum contribution remains at $300,000 per couple.

Changes to the ‘work test’

Currently, in order to make voluntary, contributions to your super once you turn 67, you must be able to show that you have been gainfully employed for 40 hours or more in any 30-day period in a financial year. 

From 1 July 2022, members under 75 years of age will be able to make or receive personal contributions and salary sacrificed contributions without meeting the work test, subject to existing contribution cap limits. These cap limits for concessional or tax deductible contributions are $27,500 per annum, and for non-concessional or after-tax contributions $110,000 per annum.

‘Bring forward’ rule changes

If you make contributions above the annual non-concessional contributions cap you may be eligible to automatically gain access to future year caps. This is known as the bring-forward arrangement. It allows you to make extra non-concessional contributions without having to pay extra tax.

From 1 July 2022 individuals who are under age 75 at the start of the financial year will be able to trigger the bring-forward rule, allowing them to make non-concessional contributions of up to $330,000 in one year. Previously, the rule allowed those under 67 to be eligible for the contributions.

Removal of $450 super guarantee support

For Superannuation Guarantee (SG) quarters commencing 1 July 2022, the minimum threshold will be removed and an employer will also be required to pay SG on earnings less than $450 in a calendar month.

Superannuation Guarantee increase

From the 1st of July 2022, the Superannuation Guarantee will increase and employers will be required to contribute 10.5% of employee’s salary as superannuation.

If you have any questions, you can contact our team today.