SMSF trustees should currently be focusing on financial planning strategies to get the best outcome at June 30, according to the SMSF Professionals’ Association of Australia.
In a statement, SPAA’s Greme Colley advised that trustees and their financial planners should be thinking about strategies including making after-tax contributions, higher tax deductible contributions and drawing down a lump sum.
“Making after-tax contributions to super, which could come from your personal savings, transferring personal investments or an inheritance, is one effective way to minimise tax,” Mr Colley said.
“This financial year the maximum personal after-tax contribution is $150,000; however, if you are 65 or under you can contribute up to $450,000 over a three-year period.
“This allows you to make substantial contributions to super and build your retirement savings. But remember, while this is a real bonus, it’s critical not to exceed the after-tax contributions caps because there can be tax penalties as high as 46.5 per cent.
“Remember, too, that from 1 July 2014, the after-tax contributions cap increases to $180,000. This means if you can trigger the bring-forward rule that a total of $540,000 can be contributed over the fixed three-year period.”
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