Self-managed superannuation fund (SMSF) trustees need to implement their financial strategies by 30 June to get the best outcomes for their funds, the SMSF Professionals' Association of Australia (SPAA) claims.
While SPAA director technical and professional standards, Graeme Colley, highlighted the benefits of maximising after-tax contributions to super, he warned that individuals who exceed the maximum levels would face hefty penalties.
"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," he 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 exceed the after-tax contributions caps because there can be tax penalties as high as 46.5%."
However, Colley said SMSF members who were in a position to trigger the bring-forward rule after 1 July 2014, could take advantage of the increased after-tax contribution cap that would enable them to put a total of $540,000 into their fund over a three-year period.
He also recommended that fund members, before age 60, who were eligible to draw amounts from their super should be encouraged to consider deferring the amount until after they turn 60, or until a later financial year when they may end up pay a lower tax rate.
