Author: Emma Partenza, Manager, TAG Financial Services
Yesterday we received welcome news that the previously announced Federal Budget measures had passed through the Senate, paving the way for Royal Assent.
SMSF members increase to 6
In the 2018-19 Federal Budget, the Government announced measures to increase the maximum number of members in an SMSF from 4 to 6. The Treasury Laws Amendment (Self-Managed Superannuation Funds) Bill 2020 that contains this measure was initially introduced into the Senate in September 2020. Yesterday this Bill passed through the Senate to become law.
We are now a significant step closer to this becoming law. Royal Assent can take up to 7-10 days. Watch this space, the end of the financial year should see this come into law.
Funds wishing to add greater than 4 members into their SMSF will require their Trust Deed reviewed to ensure their Governing Rules allow for additional members.
Read the strategies you can use in our previous blog: Increase in SMSF member numbers
Change to Bring Forward Rule
On 1 July 2020, the work test was increased to members aged 67 and above to make concessional and non-concessional contributions into superannuation. The bring forward rule did not increase at the time to align with the increase in the work test.
Treasury Laws Amendment (More Flexible Superannuation) Bill 2020 was also passed in the Senate. This Bill contained the increase in the bring forward rule up to age 67 to align with the work test. We are now just awaiting Royal Assent during the next 7-10 days.
This puts pressure on those able to take advantage of these measures prior to 30 June 2021, as the proposed commencement date is still 1 July 2020.
We will provide more updates as they become available.
If you have any questions, please contact us on 03 9886 0800 or via email.
Superannuation Strategies Online Seminar 2021, 10 August | 9am – 4.30pm. Register now for our online seminar and hear about how the changes (both proposed and approved) will impact your clients.
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Disclaimer: The information contained is general in nature. Professional advice should be sought before acting on any aspect on this page. Financial planning services provided by TAG Financial Advisors Pty Ltd (ABN 77 154 205 017 AFSL 415632), a wholly owned subsidiary of TAG Financial Services Pty Ltd (ABN 67 075 374 686). Copyright 2021. Please do not reproduce without the expressed written consent of the author.