Superannuation Alert 5.05.16
Financial Services eBulletin - 5 May 2016
The Lander & Rogers Superannuation Alert is a brief overview of new developments in the superannuation industry.
- On 22 April 2016, the Assistant Treasurer, Kelly O'Dwyer, issued a media release announcing that as part of the process of streamlining regulatory approvals, she has delegated all of her powers under Chapter 7 of the Corporations Act 2001 (Cth) to authorised ASIC officers (see Delegation Instrument ). According to Minister O'Dwyer "this delegation is a further step… to ensure our regulatory system is well-positioned to respond to innovation so that our financial sector can remain internationally competitive." Guidelines have been made available in relation to the exercise of those powers.
- On 28 April 2016, the ASIC Superannuation (Amendment) Instrument 2016/345 was registered (and which commenced on 29 April 2016). The Explanatory Statement states that "the purpose of the Instrument is to further defer the start date until 1 July 2017 for certain disclosures required under subsection 29QB(1) of the SIS Act for standard employer-sponsored sub-plans. This will give RSE licensees enough time to comply with the full requirements of section 29QB of the SIS Act in relation to these types of sub-plans."
- On 3 May 2016, the Treasurer, Scott Morrison, handed down the 2016-17 Federal Budget in which he announced a number of changes to the superannuation system (refer to the Budget 2016-17 Overview). The Tax and Super Budget Paper notes that the superannuation reforms have been developed on the basis of the Government's proposed "objective of superannuation" to be enshrined in legislation which is "to provide income in retirement to substitute or supplement the Age Pension". The key measures announced include:
- a new $1.6 million transfer balance cap on the total amount that an individual can transfer into the pension phase;
- a new $500,000 life-time cap on non-concessional contributions;
- the annual concessional contributions cap has been reduced to $25,000;
- a removal of the transition to retirement income stream tax exemptions;
- an extension of the 30% tax on concessional contributions applicable to high income earners to those earning over $250,000 (previously $300,000);
- a replacement of the Low Income Superannuation Contribution with the Low Income Superannuation Tax Offset from 1 July 2017;
- an ability for individuals under the age of 75 to claim tax deductions for personal superannuation contributions to eligible superannuation funds;
- the current income threshold for the spouse tax offset will be increased from $10,800 to $37,000;
- the regulatory barriers restricting 65-75 aged taxpayers from making contributions will be removed and the contribution acceptance rules for all individuals aged up to 75 will now be the same;
- the tax exemption on earnings in the retirement phase will be extended to products such as deferred lifetime annuities and group self-annuitisation products;
- a removal of the anti-detriment payments regime; and
- additional funding for APRA ($10 million) and ASIC ($121 million).
All information on this site is of a general nature only and is not intended to be relied upon as, nor to be a substitute for, specific legal professional advice. No responsibility for the loss occasioned to any person acting on or refraining from action as a result of any material published can be accepted.