Over 2,000 queries were directed to BT’s technical services team this quarter, with the volume of those queries spiking following the pre-election budget announcement on Tuesday night.
The five biggest budget-related topics for advisers were:
- Tax relief for clients with incomes below $126,000
- Supporting retirees with the extension of minimum pension drawdowns
- No changes to the increase of the Superannuation Guarantee
- Social security measures
- Work test amendments become law, bring forward clarified
The work test and bring forward measures related to last year’s budget and, with the passing of legislation earlier this year, advisers now have greater certainty over how the rules apply. The ATO provided further clarification on the bring forward rules by publishing a much anticipated example this week, illustrating an individual aged 74 on 1 July, being eligible to trigger a bring-forward non-concessional contribution.
“Some in the wealth management and advice industries may have expected more proposed measures that would impact clients from this budget,” BT technical consultant Tim Howard said.
“However, at the same time, the limited changes to areas related to advice will no doubt provide welcome certainty.”
It comes after the Financial Planning Association of Australia (FPA) CEO Sarah Abood said the lack of major changes relating to financial planners or clients is a small win and will allow them to continue helping clients and grow businesses.
“It is an opportunity for financial planners to catch their breath after years of change,” she said.
Tax offsets for small businesses and the support of a digital economy were widely welcomed by industry groups, as was the government’s move to extend the temporary reduction in superannuation pension drawdown rates into the next financial year.
Originally announced in March 2020 as part of the government’s response to the pandemic, Treasurer Josh Frydenberg said the reduction would now remain in place until 30 June 2023.
Read the biggest talking points from the pre-election budget here.
