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Re: Contributions to super

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Newbie

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Can I make catch up contributions or ncc brought forward to super in the financial I turn 65 but after I have turned 65 in that financial year.
Thanks
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Devotee

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Hi @creimers

 

You can qualify for the carry foward concessional contribution rule irrespective of age. However, to contribute after your 65th birthday you must satisfy the work test in the Financial Year prior to making the contribution. Only unused concessional contributions cap amounts for the 2018-19 and future financial years can be carried forward. This means the first year an individual will be able to make additional concessional contributions by applying their unused concessional contributions cap amounts is the 2019-20 financial year.   

 

To be able to make a contribution under the catch-up of unused concessional contributions rules, the value of an individual’s Total Superannuation Balance (TSB) immediately before the start of the relevant financial year (ie the 30 June value) must be less than $500,000. The $500,000 TSB threshold is not indexed.

 

It is important to note that it’s only a member’s TSB immediately before the start of the relevant financial year that is relevant. This means an individual who may be ineligible one year due to their TSB exceeding $500,000, may requalify in a future year if their TSB subsequently falls below $500,000. This could occur as a result of negative market movements or benefit payments where a member has satisfied a condition of release.   

 

Under the bring-forward NCC provision the rules are slightly different. If you wish to trigger the ‘bring-forward rule’ in the financial year that you turn age 65, the timing of such contributions will have to be determined by whether you have met the work test during the financial year. If the work test has not been met, you can only make contributions (and therefore trigger the ‘bring-forward rule’) prior to reaching age 65. If the work test has been met, however, the client can trigger the ‘bring-forward rule’ by making after tax contributions at any time during the financial year in which you reach 65 (including contributions made after their 65th birthday).

 

Note, from 1 july 2017, the maximum NCC cap available (including the bring-forward cap) is affected by their Total Superannuation Balance immediately before the beginning of the FY they contirbute. If your TSB as at 30 june 2018 was less than $1.4 million, and had not triggered the bring-forward provision over the past 3 FYs, then shoud be sweet to go ahead.

 

Hope this helps

 

1 REPLY 1
Highlighted

Most helpful response

Devotee

Replies 0

Hi @creimers

 

You can qualify for the carry foward concessional contribution rule irrespective of age. However, to contribute after your 65th birthday you must satisfy the work test in the Financial Year prior to making the contribution. Only unused concessional contributions cap amounts for the 2018-19 and future financial years can be carried forward. This means the first year an individual will be able to make additional concessional contributions by applying their unused concessional contributions cap amounts is the 2019-20 financial year.   

 

To be able to make a contribution under the catch-up of unused concessional contributions rules, the value of an individual’s Total Superannuation Balance (TSB) immediately before the start of the relevant financial year (ie the 30 June value) must be less than $500,000. The $500,000 TSB threshold is not indexed.

 

It is important to note that it’s only a member’s TSB immediately before the start of the relevant financial year that is relevant. This means an individual who may be ineligible one year due to their TSB exceeding $500,000, may requalify in a future year if their TSB subsequently falls below $500,000. This could occur as a result of negative market movements or benefit payments where a member has satisfied a condition of release.   

 

Under the bring-forward NCC provision the rules are slightly different. If you wish to trigger the ‘bring-forward rule’ in the financial year that you turn age 65, the timing of such contributions will have to be determined by whether you have met the work test during the financial year. If the work test has not been met, you can only make contributions (and therefore trigger the ‘bring-forward rule’) prior to reaching age 65. If the work test has been met, however, the client can trigger the ‘bring-forward rule’ by making after tax contributions at any time during the financial year in which you reach 65 (including contributions made after their 65th birthday).

 

Note, from 1 july 2017, the maximum NCC cap available (including the bring-forward cap) is affected by their Total Superannuation Balance immediately before the beginning of the FY they contirbute. If your TSB as at 30 june 2018 was less than $1.4 million, and had not triggered the bring-forward provision over the past 3 FYs, then shoud be sweet to go ahead.

 

Hope this helps