As we draw closer to 30 June 2023 it is important to consider tax planning strategies as well as other administrative duties for your money in superannuation.
Contributions
Concessional Contributions
Concessional contributions cap for the 2023 FY is $27,500 and the deposits must be received into the Super Fund prior to 30 June 2023.
When making a member concessional (deductible) contribution, you must give your notice of intent to claim the deduction to your Super Fund before the earlier of when you lodge your tax return or the end of the next financial year.
If you are looking to commence a pension or roll monies to another Super Fund, you must give the notice of intent to claim the deduction beforehand, otherwise the contribution would be treated as non-concessional contribution which may have adverse consequences.
Non-Concessional Contributions
The non-concessional contributions cap for the 2023 FY is $110,000 if your total super balance at the close of the previous financial year is under $1,700,000.
If you are under the age of 67 you can bring-forward three years’ worth of non-concessional contributions in the one financial year as detailed below:
| Total super balance at 1 July | Non-concessional contributions cap for the first year | Bring-forward period |
| Less than $1.48m | $330,000 | 3 Years |
| $1.48m – $1.59m | $220,000 | 2 Years |
| $1.59 – $1.7m | $110,000 | 1 Year |
| $1.7m or more | $0 | Not applicable |
PLEASE NOTE: From 1 July 2023, the total super balance threshold has been increased through indexation by $200,000 to $1,900,000 which is then tiered down per the above annual caps.
Catch Up Contributions
From 1 July 2018 if a person’s total super balance is under $500,000 they can utilise their prior year unused contributions cap (difference between cap and contributions actually made) and make a catch up concessional contribution into their Super Fund.
PLEASE NOTE: From 1 July 2023, the five year rolling period moves to start from 1 July 2019. Members need to review whether or not they’ll have more unused contribution cap space in either the 2019 or 2020 financial year, if they want to maximize the amount of contributions they can make under this provision.
Work test for Member Concessional Contributions
If you are between the ages of 67 and 74 you will need to pass a work test to contribute member concessional (deductible) amounts into your Super Fund, this requirement means a person must work 40 hours in a 30 day period once in the financial year to be eligible to make the contribution.
Work Test Exempt Contributions
From 1 July 2019 if you retire between the ages of 67 to 74 and have a total super balance under $300,000 you can make further contributions into a Super Fund in the next financial year without having to pass the work test.
PLEASE NOTE: From 1 July 2022 this exemption will likely become redundant due to the work test changes.
Downsizer Contributions
If you have sold your principal place of residence or a property which at one time was your principal place of residence you can make a contribution up to $300,000 into your Super Fund. To qualify you need to be over the age of 55 and held the property continuously for a minimum 10 year period, prior to the sale.
PLEASE NOTE: The age requirement was lowered from 60 to 55 from 1 January 2023.
Government Co-Contributions
If you are a low or middle-income earner and make non-concessional (after-tax) super contributions to your super fund, the government also makes a contribution (called a co-contribution) up to a maximum amount of $500.
Low Income Super Tax Offset
Eligible individuals with an adjusted taxable income up to $37,000 will receive a low income super tax offset (LISTO) payment to their super fund equal to 15% of their concessional contributions from employment. Maximum offset is $500 and can be paid directly you if you’ve reached preservation age or are retired.
Spouse contributions
If your spouse’s annual income is $37,000 or less and you make a minimum contribution of $3,000 into their Super Fund you will be eligible to the full offset of $540.
You may be able to claim a partial tax offset, if you pay less than $3,000 and your spouse earns more than $37,000 but less than $40,000.
First Home Super Saver Scheme
If you have never held property in your name you can make a voluntary contribution into your Super Fund up to an annual cap of $15,000 and a total of $50,000 to then withdraw to assist with the purchase of your first home.
Super Guarantee
Employers and employees should note that from 1 July 2023 the super guarantee rates increased from 10.50% to 11.00%.
Further, employers should also note that there is no minimum salary threshold for when super guarantee applies to employees.
Pensions
Indexation of Transfer Balance Cap (TBC)
Currently, an eligible member can establish a new pension of $1,700,000 which is added to their general transfer balance cap which is plainly, the amount of monies allowed in pension phase.
From 1 July 2023 this cap increased by $200,000 for eligible members to $1,900,000.
Members who have previously used some of their general transfer balance cap will only receive a proportional increase based on the highest ever balance of your transfer balance cap between 1 July 2017 and 30 June 2022.
Annual Minimum Requirement
If you are in receipt of a pension you will need to ensure that you have withdrawn your annual minimum prior to 30 June 2023.
For the 2019/2020, 2020/2021 and 2021/2022 financial years there is a temporary halving of the annual requirement for account based pensions similar pension products.
The temporary minimum rates are detailed below:
| Age of Member | Percentage Factor |
| Under 65 | 2% |
| 65 – 74 | 2.5% |
| 75 – 79 | 3% |
| 80 – 84 | 3.5% |
| 85 – 89 | 4.5% |
| 90 – 94 | 5.5% |
| 95 + | 7% |
PLEASE NOTE: From 1 July 2023, the temporary halving of the annual pension minimum requirement is ceasing and will revert to their full amounts.
Transition to Retirement Pensions
If you are in receipt of this type of pension you need to ensure you have not withdrawn over the maximum limit of 10% of the account balance at the close of the previous financial year
Investment Strategy
Trustees of Self-Managed Super Funds will need to ensure they have reviewed their investment strategy to ensure their current investment allocations agree.
Asset Valuations
Trustees of SMSFs need to ensure that their investments including direct real property and indirect real property (holdings in related units trusts) are revalued at 30 June 2023 to assist in the preparation of the financial statements.
For property holdings, we would recommend a curbside valuation be completed which includes comparable sales data.
In House Assets
Trustees of SMSFs with in-house assets must ensure that the value of these assets remains under 5% of the total assets at 30 June 2023.
Related Party Dealings
Where an SMSF has dealt with a related party, the Trustee must ensure that those transactions have occurred on an arms-length basis and if there’s been a deviation that rectification occurs prior to 30 June 2023. Common examples include commercial property where the tenant is a related party and there is a lease arrangement in place, or where there is a loan to the SMSF in the form of a Limited Recourse Borrowing Arrangement.
For further assistance please contact Daniel Shaw, SMSF Specialist Adviser and head of Superannuation of this office who can assist with your enquiries.
The information provided does not constitute financial product advice. The information is of a general nature only and does not take into account your individual objectives, financial situation or needs. It should not be used, relied upon, or treated as a substitute for specific professional advice. We recommend that you obtain your own independent professional advice before making any decision in relation to your particular requirements or circumstances.
