On 22nd October 2012 the federal Treasurer announced several new policy measures as part of the “Mid-Year Economic and Fiscal Outlook.
Some of the key changes of relevance to our clients include:
• Most significantly: the super fund earnings tax exemption will continue after death of a pension phase member until the benefit has been paid by the fund; before, assets sold in a pension account after death became subject to CGT.
• Small increase in annual SMSF levy from $191 to $259pa from July 2014 and no longer collected in arrears.
• ‘Lost’ super accounts will go to the ATO for balances of up to $2 000 inactive for a year or more (ie no contributions made). The ATO will only pay interest at the rate of inflation – so make sure you consolidate old super accounts.
• Changes to the private health insurance rebate result in higher costs for fund members, especially those joining a fund after their 31st birthday.
• Reduction in Baby Bonus to $3,000 for second and subsequent children, from current $5 000 per child.
For further information on these measures, please contact your usual contact at our office, or call Michael Rees-Evans, Partner – Wealth Consulting.