On 11 May 2021, as part of the 2021–22 federal Budget, the Australian Government announced it would change the superannuation contribution rules for individuals between 67 to 74 years old. This repealing of the work test for voluntary super contributions occurred last month (July 1, 2022).
What This Change Means
If you are under 75 years old, you can make or receive personal super contributions and salary sacrificed contributions (within your existing contribution cap limits) without meeting the work test. You may also be able to use the bring forward rule.
Note: you may still need to meet the work test to claim a personal super contribution deduction.
How Removing The Work Test Affects You
Before 1 July 2022, if you were 67 to 74 years old, you could only make or receive voluntary contributions (both concessional and non-concessional) to your super if you met the work test. That is, you must work at least 40 hours over a 30-day period in the relevant financial year.
From 1 July 2022, this requirement was removed except for individuals wishing to claim a personal super contribution deduction.
How Removing The Work Test Affects Super Funds
Fund Trustees no longer have to apply the work test when they accept their members’ contributions. This includes when the member provides a Notice of intent to claim or vary a personal super contribution deduction.
For individuals 67 to 74 years old wishing to claim a personal super deduction for their contribution, the ATO will administer the work test when they lodge their income tax return.
For individuals 67 to 74 years old, there is no change to how they lodge their notice of intent to claim, vary a personal super contribution deduction or lodge their income tax return.
Want to grow your superannuation? Talk to our SMSF experts today. Book your 15 minutes appointment here if you have any questions about your super.
Check out other blogs: