2016 Federal Election Superannuation Policies

By Cathi Norman - June 29, 2016

We are now just a few days away from voting in the 2016 Federal Election. Following the 2016 Federal Budget there has been much talk and analysis regarding the Coalition Government’s superannuation policies.

In contrast, the Australian Labor Party has remained relatively quiet when it comes to their policies on superannuation. In April Labor launched its Fairer Super Plan, which is still published on their website and appears to be their current policy. The final line of this document clearly states:

If elected these are the final and only changes Labor will make to the tax treatment of superannuation.

However, on the weekend Labor announced that if elected, it would review the current Government’s proposed changes to superannuation announced in the 2016 Federal Budget. This suggests that if elected Labor may potentially make further changes to superannuation.  

So what do we know about each party’s superannuation policies so far?

Superannuation Policies

 

Liberal Party of Australia

Australian Labor Party

Superannuation Contributions Tax

Division 293 income threshold to reduce from $300,000 per year to $250,000 per year.

Division 293 income threshold to reduce from $300,000 per year to $250,000 per year.

Pension Accounts

Pension balances to be capped at $1.6 million per individual from 1/7/2017. 

Individuals receiving pensions would pay 15% tax (within the fund) on annual investment earnings over $75,000.

Transition To Retirement Pensions

Removal of tax exemption on earnings for pension assets supporting transition to retirement pensions from 1/7/2017.

Policy not announced.

Concessional Contributions

Annual cap reduced to $25,000 per year for all age groups from 1/7/2017.

Individuals with a superannuation balance less than $500,000 allowed to make additional catch-up contributions.

Policy not announced.

Non-Concessional Contributions

A lifetime non-concessional contributions cap of $500,000 to be introduced from 3/5/2016. This cap to include contributions from 1/7/2007 onwards.

Policy not announced, however they have argued vehemently against the $500,000 lifetime cap, stating that it is retrospective.

Tax Deductions For Personal Contributions

All individuals up to age 75 allowed a tax deduction for personal superannuation contributions from 1/7/2017 regardless of employment circumstances.

Policy not announced.

Contributions Work Test

Work test to be removed from 1/7/2017

Policy not announced.


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