As of 1 July 2009, the Government implemented changes to superannuation concessions. If you’re still salary sacrificing into your superannuation fund, you need to make sure this is still the best way to maximise your super.
The annual cap on concessional superannuation contributions will be reduced from $50,000 to $25,000 and the transitional cap (which applies until 30 June 2012 for those aged 50 years and over) will reduce from $100,000 to $50,000. Prior to 1 July 2009, any salary sacrificed into a superannuation fund was not counted towards the Centrelink income test. Now however, if you are under Age Pension age, any income that you salary sacrifice into superannuation will be counted as gross income under the income test.
Also being temporarily reduced is the superannuation co-contribution matching rate from 150 per cent to 100 per cent for contributions made in 2009-10, 2010-11 and 2010-12(a maximum co-contribution of $1,000 will apply). This will be increased to 125 per cent for contributions made in 2012-13 and 2013-14 (a maximum co-contribution of $1,250 will apply).
Before making any financial decisions, you should consult an independent financial advisor. For more information on the changes to concessional superannuation contributions, visit the Parliament House website.