Superannuation gets tricky at year-end. You want to make sure you’ve met your obligations as a business and used your personal fund wisely for tax planning purposes. So here’s a checklist of things you will want to think about.
EMPLOYER CHECK LIST
NOTE YEAR END TIMING: First thing to note is that 30 June falls on a Sunday this year. Get everything done by Thursday 27 June to make sure your ducks are in a row at year-end.
PAY EMPLOYEES’ SUPER ON TIME: All funds must be paid into super accounts by no later than 28 days after the end of the quarter or harsh penalties apply. But remember – any super not physically PAID by 30 June will not be deductible in this fiscal year. So if you plan to take a deduction make sure your super payments are made by Thursday 27 June.
GET READY FOR 1 JULY CHANGES: The super guarantee contributions will increase from 9% to 9.25% from 1 July 2013. Also, if you employ anyone over 70 you are now obligated to pay super entitlements. Make sure you are ready for these changes.
PERSONAL SUPER CHECKLIST
WATCH YOUR CONCESSIONAL CONTRIBUTION CAP: The concessional cap for individuals over 50 has been reduced to $25,000 from 1 July 2012. Make sure you do not exceed your cap or you risk high penalties.
CONSIDER A NON-CONCESSIONAL CONTRIBUTION If you have proceeds from an inheritance or sale of property sitting in cahs, you might want to consider moving some or all of it into super to help control your tax bill. If you are under 65 the bring forward provision allows you to contribute up to $450,000 over 3 years.
CHECK ENTITLEMENT TO CO-CONTRIBUTIONS: If your total personal income is $46,920 or less, then consider taking advantage of government co-contributions. Every dollar of non-concessional (ie/ after tax) super contribution you make, the government will contribute 50 cents, up to $500., if your income is $31,920 or less. The co-contribution reduces by 3.33 cents for every dollar above that.
CHECK YOU’VE TAKEN YOUR MINIMUM PENSION: If you are in the pension phase, ensure you’ve received the minimum pension amount before 30 June or risk fines. The ATO site provides pension guidelines.
SMSF HOLDER CHECKLIST
MAKE ANY OFF MARKET TRANSFERS THIS YEAR: The government has proposed banning off market transfers from 1 July 2013. So if you are thinking of transferring any listed securities into your SMSF from yourself or a related party do it now or risk being liable for brokerage and other costs.
REVIEW YOUR CAPITAL GAINS TAX POSITION: Review the capital gains your fund has made through the year and consider disposing of investments with unrealized losses that could be offset against these gains.
If you need assistance planning for any aspect of your year end please contact me on 6652 8788 or firstname.lastname@example.org. We are here to help!