Treasurer Josh Frydenberg has announced a new measure which will enable Australians approaching their retirement years to make voluntary superannuation contributions, both concessional and non-concessional, without meeting the work test.
Currently, they can only make voluntary contributions if they meet the work test, which requires that they work a minimum of 40 hours over a 30-day period.
This means that Australians aged 65 or 66 years who don’t meet the work test, because they may only work one day a week or volunteer, will now be able to make voluntary contributions to their superannuation, said Mr Frydenberg.
“This will align the work test with the eligibility age for the age pension, which is scheduled to reach 67 from 1 July 2023.”
Mr Frydenberg said there are around 55,000 Australians aged 65 and 66 who will benefit from this reform in 2020-21.
The Morrison government has also announced it will increase the age limit for spouse contributions from 69 to 74 years.
Currently, those aged 70 years and over cannot receive contributions made by another person on their behalf.
“We will also extend access to the bring-forward arrangements, which currently allow those aged less than 65 years to make three years’ worth of non-concessional contributions, which are capped at $100,000 a year, to their super in a single year. This will now be extended to those aged 65 and 66,” said Mr Frydenberg.
Miranda Brownlee is the deputy editor of SMSF Adviser, which is the leading source of news, strategy and educational content for professionals working in the SMSF sector.
Since joining the team in 2014, Miranda has been responsible for breaking some of the biggest superannuation stories in Australia and has reported extensively on technical strategy and legislative updates. Miranda has also directed SMSF Adviser's print publication for several years.
Miranda also has broad business and financial services reporting experience, having written for titles including Investor Daily, ifa and Accountants Daily.