As part of a key commitment in the Budget, the Government has introduced a bill to remove the $450 per month income threshold for superannuation payments.
The Treasury Laws Amendment (Enhancing superannuation outcomes for Australians and helping Australian businesses invest) Bill 2021 also aimed to improve flexibility for those preparing for retirement, support more Australians to own their first home, and help Australian businesses invest.
The bill would also reduce costs and simplified reporting for self-managed superannuation funds (SMSF) and small Australian Prudential Regulation Authority (APRA) regulated funds.
The bill’s announcement by the minister for superannuation, financial services, and the digital economy, Jane Hume, said the removal of the $450 threshold improved equity in the super system and increased the economic security of women in retirement.
On the First Home Super Saver Scheme (FHSSS) the bill allowed the maximum voluntary contribution people were allowed to release from $30,000 to $50,000 to put down as a first home deposit.
The eligibility age to make downsizer contributions into superannuation would reduce from 65 to 60 years of age to allow more older Australians to consider downsizing to a home that better suited their needs in a bid to free up the stock of larger homes for younger families.
The bill also preserved the work test for personal deductible contributions made by individuals aged between 67 and 75. It would also make amendments necessary to allow eligible individuals to make non concessional superannuation contributions under the bring forward rule. This would improve flexibility for older Australians to contribute to their superannuation.
Trustees would now be able to use their preferred method of calculating exempt current pension income where the fund is fully in the retirement phase for part of the income year but not for the entire income year.
The announcement said the changes would commence from 1 July, 2022.