Superannuation Concessional Cap Raised By $10,000

The salary you sacrifice will reap super dividends for you and more quickly so if you are nearing 60 or already over it, reports Noel Whittaker for “The Observer”.

The superannuation concessional cap has been raised from $25,000 a year to $35,000 a year. So what does it mean in practice? You know that your employer is expected to put 9.25% of your yearly salary into your superannuation fund.

For somebody earning $100,000 a year, this amounts to only $9,250 so additionally that employee can now put $25,750 instead of $15,750 (which would have been the case had the concessional cap remained at $25,000) into his super.

While the salary he sacrifices definitely reduces his ‘take home’ (short-term loss) but the boost his superannuation fund gets outweighs the loss in “take home’ as well as the taxes he needs to pay on the contribution.

In this regard, Transition to Retirement (TTR) pensions can also come handy.

You can read the original article here.