Super contributions are the key income in your SMSF.
What types of contributions you can make to your SMSF?
– Concessional Contributions: Generally, concessional contributions will be claimed as tax deduction in other entitles and will be tax at 15% in your super fund.
– Non-concessional Contributions: Non-concessional contributions are sometimes known as ‘after-tax’ contributions. These contributions basically will not be claimed as deductions anywhere and will not be taxed in your super fund.
What is the work tests?
– After you turn 65 years of age, you have to have to work at least 40 hours in any 30 day consecutive period during the financial year in which you make the contribution.
– The work tests apply to both concessional and non-concessional contributions.
The Three Year Bring Forward Rule
If you are under 65, the “three year bring forward rule” allows you to to bring forward two additional future years of contributions to make a larger one off contribution in the current financial year.
You can split your concessional contribution up to 85% to your partner. The restrictions are that your partner must be under 65 and mustn’t have permanently retired. It works well if your partner is older than you because he/she can establish the pension account soon.
You may claim a tax offset up to $540 if you make contributions on half of your partners.
Excess Contribution Tax
If you make contribution that exceeds the current contribution caps, you may be liable for the excess contributions tax.
If you have receive a excess contribution assessment notice (Div293 tax) from ATO, please contact us and we will advise you how to pay this from your own money or from your SMSF.