Super changes - how they might impact you
Coming into effect on 1 July 2021
There are some significant changes to superannuation that come into effect on 1 July that will impact employers. There are some things you may need to do to prepare for these changes to stay on top of your super obligations.
Super Guarantee (SG) contributions scheduled to increase from 9.5% to 10%
The increase in the Superannuation Guarantee (SG) is legislated to phase in from 2021 to 2025. The super guarantee is set to increase yearly by 0.5% from its current base of 9.5% to 10% on 1 July 2021 and increasing to 12% by 2025.
The SG is designed to help deliver adequate income for Australians in retirement and this increase is essential for ensuring Australians have a comfortable retirement.
Super contribution caps are increasing from 1 July 2021
From 1 July 2021, the following changes will be made to the superannuation contribution caps:
- the annual concessional (before tax) contribution cap will increase from $25,000 to $27,500
- the annual non-concessional (after tax) contribution cap will increase from $100,000 to $110,000
- The non-concessional (after tax) bring-forward contribution cap will increase from $300,000 to $330,000
- the transfer balance cap will also increase from $1.6 million to $1.7 million for members who commence a pension or tax-free retirement income account for the first time.
If a pension account has already been started, the transfer balance cap remains at $1.6 million.
It is the responsibility of members to ensure they know their eligibility and are aware of their position in relation to the caps each year including any amount they intend to ‘carry-forward’. We recommend your employees seek financial advice if they are unsure of their eligibility.
We’re here to help
We’re here to help you understand these changes and stay on top of your super obligations. If you have any questions about these changes and how they could impact you, get in touch with our employer relations team on 1300 878 737.
Speak to your friendly account consultant on 1300 878 737 (1300 VSUPER)