The Australian Taxation Office is cracking down hard on excess superannuation contributions, with warnings that investors will face heavy penalties for breaching maximum amounts. The tax office is warning self-managed super members against tipping in excess contributions, including the use of the popular new scheme which splits the money into a separate trust.
About 70,000 people could be facing penalty tax charges later this year as a result of putting too much money into their super funds. Substantial penalties apply to all super members who make excess deposits, and the warning comes as we enter the final months of the financial year, when people traditionally stash extra money in their funds.
About 35,000 people are already facing fines and penalties for putting too much money into their super after the laws were applied to the June 2007 tax year. People aged under 50 cannot put in more than $25,000 from before-tax income. People over age 50 can put in up to $50,000 from before-tax income and are also limited to a total of $150,000 a year.