More flexibility for retirement

The Treasurer has announced new measure to enable Australians aged 65 and 66 to make voluntary super contributions, along with two other measures.

Super boost

The Morrison Government is taking action to help Australians boost their retirement savings by giving them greater flexibility as they near their retirement years.

From July 1 2020, Australians aged 65 and 66 will be able to make voluntary superannuation contributions, both concessional and non-concessional, without meeting the Work Test.

Currently, they can only make voluntary contributions if they meet the Work Test, which requires that they work a minimum of 40 hours over a 30 day period.

This means that Australians aged 65 or 66 years who don’t meet the work test, because they may only work one day a week or volunteer, will now be able to make voluntary contributions to their superannuation.

This will align the Work Test with the eligibility age for the Age Pension, which is scheduled to reach 67 from 1 July 2023.

There are around 55,000 Australians aged 65 and 66 who will benefit from this reform in 2020-21.

In addition, the age limit will increase for spouse contributions from 69 to 74 years. Currently, those aged 70 years and over cannot receive contributions made by another person on their behalf.

Access to the bring-forward arrangements will be extended, which currently allow those aged less than 65 years to make three years’ worth of non-concessional contributions, which are capped at $100,000 a year, to their super in a single year. This will now be extended to those aged 65 and 66. 

The government has introduced new laws that reunite superannuation members with low balance or inactive accounts, scrapped exit fees and other excessive fees, and introduced legislation to protect Australians paying premiums for insurance they don’t want or need.

Source Australian Treasury

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Last Updated:18-04-2019 12:31