Proposed changes to superannuation tax concessions

The Albanese Government recently announced plans to reduce tax concessions for people with total superannuation balances of more than $3 million. And naturally, it’s got people talking. Under the current rules, the government taxes super earnings in the accumulation phase at 15 per cent. And that concessional rate won’t change if your balance is under that $3 million threshold.

But from 2025-26 once your balance climbs over that $3-million mark, the concessional tax rate will jump to 30 per cent for future earnings.

The government says the proposed legislation change will:

• Only apply to about 80,000 people, which is less than 0.5 per cent of individuals with a super account. These people will still benefit from healthy tax concessions on earnings from their fund balance below the threshold;
• Not limit super account balance size in the accumulation phase, keeping the status quo;
• Apply to future earnings only, ruling out any retrospective application;
• Raise about $2 billion extra in tax revenue annually, helping the federal budget’s bottom line;
• And usher in more equitable tax concessions.

At CD&G Accountants, it’s our job to stay up-to-date with government legislation changes that impact our clients. So we are watching the government’s proposed changes with interest.

Our experienced accountants have been assisting people across the Geelong region with quality superannuation services for years. From helping you to set up a self-managed super fund (SMSF) to providing expert advice on annual super audits, taxation benefits and compliance, we’re the team to trust.

SMSFs are steadily growing in number in Australia, with the figure topping 603,000 mid last year. And while SMSF assets are worth more than $868 billion, industry funds have exceeded that amount. Their assets are worth more than $1 billion.

If you would like more information about our superannuation services in Geelong or have questions about SMSFs, please contact us at CD&G Accountants. We are here to help.