If you are a retiree, mark Friday, 1 July, on your calendar as there are a number of superannuation changes which are set to benefit older Australians.
Work test scrapped for mature aged people
A major change is for retirees aged between 67 and 74, who can now top up their superannuation without having to satisfy any test, provided their superannuation is less than $1.7 million in July.
The work test that specified a person had to be employed for at least 40 hours in a consecutive 30-day period will finish on 30 June, making it simpler for retirees to contribute.
A spouse also can voluntarily contribute to a partner’s super scheme.
By using the bring-forward provision, the spouse can move up to $300,000 into their younger partner’s super account.
Downsizing contributions into super now allowed at 60
The age of eligibility to sell the family home and move into a cheaper one, or a retirement community, and be allowed to contribute up to $300,000 for each member of a couple into superannuation is also being lowered from 65 to 60 as of 1 July.
However, you should check how such a contribution could affect your eligibility to claim the Age Pension.
Non-concessional contributions lifted to age 75
The cut-off age to bring forward non-concessional contributions will also lift from 67 to 75. This will allow people to place $110,000 per year for three years of non-concessional contributions up to $330,000.
This means people aged 74 on 1 July, who have less than $1.35 million in superannuation, may be able to boost their retirement savings by adding $330,000 in non-concessional contributions.
Retirees’ Home Equity Access Scheme
The Government’s reverse mortgage initiative, formerly known as the Pension Loan Scheme (PLS) and now rebranded as the Home Equity Access Scheme (HEAS), will also see a no negative equity guarantee introduced for HEAS loans.
This means that retirees will not owe more than the market value of their property, in the rare circumstances where their accrued HEAS debt exceeds the property value.
Welcome news for those of us who are retired or close to hanging up their work boots.
