Chance to tell Treasury what you really think of the work test for superannuation.
The Federal Government is seeking your views on a proposed law to exempt older Australians from the work test for a year to help them boost their superannuation savings.
Currently, the work test requires those between 65 and 74 years to have worked at least 40 hours within 30 consecutive days before they can contribute to superannuation.
The rule does not apply to the mandated contribution an employer has to forward on behalf of a worker.
But if there is a 30-day period during which you worked fewer than 40 hours, then your super fund must not accept non-mandated employer contributions, personal contributions, spouse contributions or government co-contributions.
If the draft legislation is passed, however, from 1 July 2019 those aged between 65 and 74 whose total super balance is less than $300,000 will be able to make voluntary contributions for 12 months from the end of the financial year in which they last met the work test.
That is, even if they have worked fewer than 40 hours in a 30-day period, they will be allowed to voluntarily contribute to super for up to a year beyond the financial year in which they failed the test.
Those wishing to make a submission to the draft law have until 26 October 2018 to write to Treasury.
The draft says: “The proposed regulation changes provide a one-year exemption from the work test that applies as part of the superannuation contribution acceptance rules to allow recent retirees to boost their superannuation balances.
“This Schedule ensures that the proposed regulation changes operate as intended by preventing an individual accessing a benefit up to the value of providing a three-year work test exemption period as a result of an interaction between the work test rules and the bring forward arrangements for non-concessional contributions in the Income Tax Assessment Act 1997.”
Have you tried to make extra contributions to your super but been blocked by the work test? Do you think the work test is fair? Do you believe the exemption should be backdated? Should people be allowed to contribute what they wish to super, up to the cap, regardless of the hours they have worked?
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