Federal Budget 2018: One-year exemption from the super work test

Font Size:

The Government will provide a one-year exemption from the work test for super contributions to allow recent retirees to boost their balances.

Currently, people aged 65 to 74 must work a minimum of 40 hours in any 30-day period in a financial year in order to keep making contributions to superannuation. This is known as the work test.

From 1 July 2019, Australians aged 65 to 74 with a total superannuation balance below $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.

Total superannuation balances will be assessed for eligibility at the start of the financial year following the year in which they last met the work test.

Once eligible, there is no requirement for individuals to remain under the $300,000 balance cap for the duration of the 12-month period.

Existing annual concessional and non-concessional caps ($25,000 and $100,000 respectively) will continue to apply to contributions made under the work test exemption.

Individuals will also be able to access unused concessional cap space to contribute more than $25,000 under existing concessional cap carry-forward rules during the 12 months.

As bring-forward arrangements for non-concessional contributions are not available to those aged 65 and over, individuals will not be able to access bring-forward non-concessional contributions under the work test exemption.

The work test exemption aims to give older Australians additional flexibility to contribute more into superannuation as they move into retirement.

Can you see value in the relaxation of the super work test? Will this help boost your super balance?

Join YourLifeChoices today
and get this free eBook!

Join
By joining YourLifeChoices you consent that you have read and agree to our Terms & Conditions and Privacy Policy

RELATED LINKS

Federal Budget 2018-19 wrap-up for older Australians

Budget 2018-19 has also been called a ‘Baby Boomer budget', but this is lazy shorthand for

Federal Budget 2018: Government moves to cap excessive super fees

New plan to make it easier to switch your superannuation fund.

Federal Budget 2018: Money to keep Aussies in the home longer

Government aims to keep older Australians connected to their communities.

Federal Budget 2018: Pension Loans Scheme broadened, amounts increased

Borrower eligibility extended and amounts increased.

Federal Budget 2018: Government aims to tackle healthy ageing

Programs to ensure health checks part of More Choices For a Longer Life package.

Federal Budget 2018: Plan to end age discrimination

The Government is trying to end age discrimination so people can work longer.

Federal Budget 2018: Pension Work Bonus limit rises $50 per fortnight

Age pensioners can earn an extra $50 per fortnight without penalty.

Written by Ben

3 Comments

Total Comments: 3
  1. 0
    0

    $300,000 is way too low in this day and age.

  2. 0
    0

    Why the age discrimination against those aged over 74 who may have worked past age 70, I know of one lady who retired in this financial year at the age of 74 who will have only a few weeks after 1July 2018 till she turns 75. Would it not be better, and more fair, to change the eligibility to a set period after retirement, say 2 or 5 years. This is an example of government hypocrisy, encouraging us to work longer then penalising those who do.

  3. 0
    0

    It’s a good idea. If you retire you might have long service leave etc, you want to contribute to what is still a low tax environment with reasonable rates of return. I think it was a shame they repealed a proposal for anyone aged 65 to 74 to contribute after tax dollars to super.


FACEBOOK COMMENTS



SPONSORED LINKS

continue reading

Finance

Tobacco and childcare drive cost of living increase

The Consumer Price Index (CPI) rose 0.9 per cent in the December quarter. According to the Australian Bureau of Statistics...

Age Pension

Retirement system ‘uncertain for almost all retirees’

Australia, a nation of almost four million retirees, has one of the world's best retirement systems. The 2020 Mercer CFA...

Finance

The big question: How much do I need to retire?

Life expectancies continue to rise, and with that comes a host of challenges. For governments, there's the increasing cost to...

Finance

Understanding the true cost of retirement

The Australian government spends billions on boosting retirement incomes. The two biggest costs, the Age Pension and superannuation tax concessions,...

Age Pension

Adequacy of retiree nest eggs

YourLifeChoices conducts several surveys each year to gauge the financial, physical and mental health of our 260,000 members. The aim...

Age Pension

Age Pension payments in 2021 – what you need to know

World heavyweight boxing champion, Olympian, ordained minister and successful entrepreneur George Foreman returned to the ring at the age of...

Age Pension

Services and rebates that can save you hundreds

Last year, I put together a retiree checklist. In 2021, there are some additions. This is a long list and...

Age Pension

Pension rates, PBS entitlements, health fund changes

YourLifeChoices keeps you up to date with retirement income changes. PBS co-paymentsThe maximum co-payment for general patients for drugs listed...

LOADING MORE ARTICLE...