May 2021 2 Minutes
Superannuation Rates and Thresholds Increase from 1 July 2021
The latest AWOTE details released by the ABS have been used to calculate the following superannuation rates and thresholds for 2021-22.
The concessional contributions cap is set to increase to $27,500 (up from $25,000 since 2017-18). As the concessional cap is now only indexed in $2,500 increments, the AWOTE index was (finally) sufficient to trigger an increase for 2021-22.
The non-concessional contributions cap (which is set at 4 times the concessional cap) has increased $110,000 for 2021-22. Under the bring-forward rule you can contribute up to 3 years of NCC i.e. $330,000 (subject to the other eligibility requirements).
The Capital Gains Tax cap amount for non-concessional contributions is $1.615m for 2021-22 (up from $1.565m).
The government co-contribution "lower income threshold" is $41,112 for 2021-22 (up from $39,837 for 2020-21); "higher income threshold" is $56,112 (up from $54,837).
While the current super guarantee (SG) rate is already legislated to increase from 9.5% to 10% from 1 July 2021, the "maximum contribution base" will rise to $58,920 per quarter for 2021-22 (up from $57,090 for 2020-21).
An employer is not required to provide the minimum super guarantee support for that part of an employee's ordinary time earnings (OTE) above the quarterly maximum contribution base (ie $58,920 for 2021-22). This quarterly maximum represents a per annum equivalent of $235,680 for 2021-22).
The following indexed thresholds apply for 2021-22:
- Superannuation lump sum low rate cap - $225,000 (up from $215,000);
- Untaxed plan cap - $1.615m (up from $1.565m);
- ETP cap amount - $225,000 (up from $215,000);
- Genuine redundancy and early retirement payments - tax-free amounts: base amount - $11,341 (up from $10,989); service amount - $5,672 (up from $5,496).
If you have any questions about the above superannuation rates and thresholds for 2021-22, then please contact our office and speak to Iggy.
Article from Chartered Accountants Australia and New Zealand.
Essential Tax & Super Update - Quarterly Update | Period: 4 Dec 2020 to 25 Feb 2021