know it all

From 1 July 2017 the Federal Government has made changes to super that may impact you and the way you manage your super. Are you affected? Find out here. 



I add extra to my super (or I would like to...)

If you top up your super savings (regularly or more ad hoc) — or you would like to — here's what's changed.

I want to know it all

 

I am preparing for retirement

If you have a HESTA Transition to Retirement (TTR) Income Stream or are thinking about starting one, here's what's changed.

I want to know it all


 

I earn under $37,000 a year

Even if you don't have much in super this is what's changed and it could help you save more for the future.

I want to know it all

 

 

already enjoying retirement?

If you're a HESTA Retirement Income Stream member, you may need to consider your options.

There is no need to take any action. Your earnings remain tax free. 

The maximum combined balance you have in your HESTA Retirement Income Stream and any other superannuation income streams in the retirement phase is $1.6 million. If you had a balance between $1.6m and $1.7m on 1 July, you have 6 months to remove the excess without penalty. However, if you had more than $1.7m on 1 July 2017, you may be subject to an excess tax charge.

Worried you might be near the cap? Request a call from a HESTA adviser to assess your options. 

There is no change from 1 July 2017.  Your earnings remain tax free. 

 

adding extra to your super

The amount you can now put in has reduced (but it's still worth it).

Contributions you (and your employer) make to your super from your before-tax pay are taxed at 15%. Once these contributions go over $25,000 the tax rate increases.  

We know not everyone will be in a position to put this kind of money into their super every year, but we also know it’s really important to keep you informed of the changes and your options.

Where do you start? Talk to your employer if you've previously made additional contributions to understand whether you need to change the amount your put in. 

If you need more information, use the online advice tool to understand your options.

If you are making contributions to more than one super fund either directly or via your employer then these contributions will also count towards the cap (i.e. if you have two super funds the one cap still applies).

 

 

Anyone can make contributions to their super directly and claim the deduction on their tax return. 

This is ideal if your employer doesn’t offer salary sacrifice or if you are partially or fully self-employed.

Once you've made your contributions, HESTA needs to be involved before you can claim a tax deduction from the ATO.

Just complete this ATO form and mail it to us before (whichever comes first); 

  • the date you lodge your tax return, OR
  • the end of the financial year after the contribution was made, OR 
  • you withdraw your super from HESTA OR
  • you commence an Income Stream.

We’ll check your form and let you know that it’s valid, so you can proceed with the relevant option above. If your form is not valid we will let you know next steps.

Making contributions directly into your super from your savings or your take-home pay is called a ‘non-concessional’ or ‘after-tax’ contribution.

You can put up to $100,000 per year into your super using this method. 

We understand this is a lot of money and not everyone will be impacted by this change. However, if this sounds like you, read on.

Ready to make a contribution?

Do it via:

  1. Direct debit: complete this direct debit form 
  2. BPAY: login to Member Online for your Biller Code and Reference Number.
  3. Cheque: complete this contribution deposit form

Or to learn more, use the online advice tool to understand your options.

If you’re under 65, you can do what’s called ‘bringing forward’ two years’ worth of after-tax contributions.

This means you can put in up to $300,000 over three years. (This might change as your balance approaches $1.6million.) 

If you were already making the most of the bring-forward rule last financial year (2016-17) contact your HESTA Advice team about your options.

As a high income earner, you will have to pay more tax (known as Division 293 tax) on any before-tax contributions made to your super. 

The additional tax is 15% and the Australian Tax Office (ATO) will let you know if you have to pay this. You can pay it directly once you receive the assessment from the ATO or you have the option to pay some or all of it from your super balance. 

To learn more about this additional tax visit www.ato.gov.au for more information.

Once your total combined super and income stream reaches $1.6million you are no longer eligible to make after-tax (non-concessional) contributions.

Is this you?

Make an appointment now with the HESTA Advice team who can help you with a tax effective strategy. 

 

transitioning to retirement

There are changes that affect you. To better understand how the changes affect the HESTA TTR Income Stream read the Significant Event Notice (SEN).

If you have a HESTA Transition to Retirement (TTR) Income Stream, your money is already invested in a way that is designed specifically for those approaching or in retirement. But of course, you have options and can choose what’s best for you.

The government is now applying up to 15% tax for investments attached to this ‘transition’ stage. This means earnings from your TTR investments.

For more detailed information about the changes to the TTR Income Stream please read the Significant Event Notice.

Of course, once you're eligible to move your money into a retirement income stream, all your earnings will be tax–free.

If you want to understand when you will become eligible for a retirement income stream or explore your options in more detail, you can read all about it and apply for a HESTA Retirement Income Stream here.

If you still have questions or want to talk things through, set up a time to talk to a HESTA Adviser.

 

If you have a TTR you are taxed up to 15% on your investment earnings. For more detailed information read the Significant Event Notice. If you are between preservation age and 65 please let us know that you have retired so we can convert your TTR to a HESTA Retirement Income Stream where the investment earnings are tax free. 

  • Want to let us know you have retired? Simply complete this form.

The amount you can transfer from your super account to a retirement income stream is limited to $1.6 million.  

What counts towards the cap?

Any money you transfer from a super account and/or TTR income stream account into a retirement income stream (including super pension and annuity products) is counted.

Worried you're near the cap? Make an appointment to talk to a HESTA adviser to assess your options.

Not worried about the cap but want to know more about HESTA Retirement Income Stream options? Click here.

 

Contributions you (and your employer) make to your super from your before-tax pay are taxed at 15%. Once these contributions go over $25,000 the tax rate increases.  
 
Where do you start?
 
Talk to your employer to understand whether you need to change the amount you put in or contact the HESTA Advice Team to assess your options.
 

If you need more information, use the online advice tool to understand your options.

If you are making contributions to more than one super fund either directly or via your employer then these contributions will also count towards the cap (i.e. if you have two super funds the one cap still applies).

Making contributions directly into your super from your savings or your take-home pay is called a ‘non-concessional’ or ‘after-tax’ contribution.

You can put up to $100,000 per year into your super using this method. 

Ready to make a contribution?

Do it via:

  1. Direct debit: complete this direct debit form
  2. BPAY: login to Member Online for your Biller Code and Reference Number
  3. Cheque: complete this contribution deposit form

Or to learn more, use the online advice tool to understand your options.

If you’re under 65, you can do what’s called ‘bringing forward’ two years’ worth of after-tax contributions.

This means that from 1 July, 2017 you can put in up to $300,000 over three years. (This might change once your balance approaches $1.6million.) 

If you are already making the most of the bring-forward rule but haven’t reached the limit, contact your HESTA Advice team.

 

I earn under $37,000 a year

Some good news for you.

The Low Income Super Contribution (LISC) has been replaced by the Low Income Superannuation Tax Offset (LISTO), but the name is the only thing that’s changing.

You may not have noticed, but it might be worth checking your super statement, because if you're eligible the government automatically pays up to $500 into your super, every year.

The ATO will determine if you're eligible and make the payment, so you don’t need to let HESTA or the government know you would like to receive this benefit.

BUT WAIT - if we don't have your tax file number (TFN) on record then the payment can't be made into your account. Check that you've provided your TFN by logging into your Member Online account.

We understand it’s unlikely you will be putting over $100,000 into your super in a year. 

However, there can be times where you receive a significant amount (e.g. inheritance) and look to add this to your super. 

If you do put more than $100,000 into your super you won’t be eligible to receive the co-contribution payment, even if you meet the other requirements.   

More people are now eligible to receive the 'spouse offset'.

So this is worth a look.

If you earn less than $40,000 a year your partner could contribute money into your super account and potentially claim a tax offset of up to $540 (against a $3,000 contribution), which could lower their tax bill.

Note: If your partner is aged over 65, they may need to meet other conditions. More detail is on the back of the spouse contribution form.

 

 

 

Want to know more?

If you think you're affected and need to talk, we are available to help.