Super Guide Newsletter April 2015

April 2015 SuperGuide Alert


Taxpayer's guide to super tax reform, looting SMSFs, franking credits at risk, new rules for excess contributions

On 30 March 2015, the federal government released the 2015 Tax Discussion Paper (also known as Re:think). The 200-page document is peppered with disturbing ideas about what the federal treasurer, Joe Hockey, and the prime minister, Tony Abbott have in store for your personal income, superannuation benefits and other investments (including tax treatment of capital gains and share dividends). I encourage all readers concerned about these issues to make a submission in response to the tax discussion paper.

  • SUPER GUIDE TO THE 2015 TAX DISCUSSION PAPER. Although the government talks about consultation, it is clear the government wants to cut the company tax rate, and cut the top marginal tax rate. How will they fund this? We are not sure yet, but the government seems keen to tax the earnings on assets supporting super pensions, and to remove the tax discount on all capital gains just for starters. Discover my 18 tax predictions (that is, what the government is intending to do) based on reading between the lines.
  • SUPER RICH TAX? LOOTING SMSF ACCOUNTS TO FIX BUDGET. Be prepared for an onslaught of irrational claims that SMSFs are rorting the system, due to the behaviour of a tiny minority. The latest, and the most significant, is a paper prepared by ASFA. The claims contained in this paper are reinforced by loud comments made by opposition treasurer, Chris Bowen, about supporting the Liberals in targeting the 'rich' and their superannuation benefits.
  • GUEST CONTRIBUTOR: FRANKED DIVIDENDS ARE NOT A TAX CONCESSION. We republish an article written by a regular SuperGuide reader, Jack Simson, where he responds to the FSI's disturbing suggestion (and now the push by the government's tax discussion paper) that franking credits should be removed to help foreign investors, at the expense of Australian investors, including super funds and retirees.
  • NIGHTMARE ON SUPER STREET: EXCESS CONTRIBUTIONS. The laws permitting the refund of excess non-concessional contributions are now law. This article summarises the treatment of both excess concessional and non-concessional contributions.

We will have more details on excess contributions, proposed super tax changes, and other important super topics in our regular April 2015 newsletter, which will be sent out later in the month.

You can access the articles contained in this Alert by clicking on the links below.

Thanks for your interest and support.

Trish Power

Super Guide to the 2015 Tax Discussion Paper

It took me three days to properly read the federal government's March 2015 Tax Discussion Paper (also known as 'Re:think'), and another three days to write this article. The reason I took my time reading through the government's Tax Discussion Paper (and writing about it) is because there is a lot contained within the document, and many of the issues affecting taxpayers, especially super fund members, are hidden in the most unlikely sections of this 200-page paper. Read more

Super rich tax? Looting SMSF accounts to fix the budget

Every few months, I have dinner with friends who work in the superannuation industry and invariably a comment will be made that DIY super funds (self-managed super funds), are just for the super rich - sound familiar? One friend in particular will claim that a lot of SMSF members have tens of millions of dollars in assets and earn mega-bucks and don't deserve the tax concessions that are currently available. Read more

Guest contributor: Franked dividends are not a tax concession

According to the Murray Financial System Inquiry, dividend imputation creates a bias in the system because income from other investments including bank deposits and fixed interest investments do not have the same concession.  Read more

Nightmare on super street: Excess contributions

Since 1 July 2013, if you exceed your concessional or non-concessional cap, the consequences are generally administrative inconvenience and a small financial charge. Before July 2013 (and this still applies for the financial years before July 2013), the consequences of exceeding one or both caps could be financially devastating. Read more