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Top Ten Things You May Not Know About Superannuation

Written by Kris Wrenn – Senior Financial Adviser & CFO

Superannuation can be considered a somewhat complex creature, and constantly changing legislation doesn’t help matters. Below I have compiled my top ten facts that I regularly find members are unaware of when it comes to their retirement nest eggs:

1/ Anyone under the age of 67 can put money in to Super without satisfying a work test and as at July 1st this is set to rise to anyone under age 75 (post-tax or “non-concessional contributions” only). This can be very advantageous for those who are no longer working to add to their Super fund before starting an allocated pension.

2/ Since the 2018/19 financial year, any unused pre-tax (concessional) contributions can be carried forward to the current financial year, as long as your Super balance was under $500,000 as at July 1st. For example, you might only have had employer contributions in the 18/19 year of $10,000, meaning you have $15,000 remaining of the $25,000 cap for that year available to you now. The amount you can put in is looked at over a 5-year rolling period, so if you haven’t made any contributions it’s possible you might be eligible to contribute $102,500 this financial year as a tax-deductible contribution. This could be an amazing strategy for those that realise a large capital gain (perhaps from the sale of a property). If you hold off again until July (the new financial year), this amount might be $130,000).

3/ Earnings within your Superannuation fund are taxable up to 15% regardless of your age. Earnings within an Allocated Pension however incur no tax.

4/ You can invest your Super in cash. Although not a recommended strategy in the current climate, it is important to remember that if you are holding large amounts of cash outside of Super, and are perhaps nearing retirement, these funds may be more wisely invested in the same asset class, but under the more tax effective umbrella that is Superannuation.

5/ If you are nearing the age where you can apply for the Age Pension, consider this … your spouse’s Superannuation balance does not impact your entitlements to the Age Pension, if they are under pension age. So couples with an age gap of say 5 years or more might significantly benefit from a rearrangement of assets between Super funds. Talk to a Hudson adviser to find out more.

6/ There are calculators available on the internet that can provide an estimate of how much you will have in retirement, based on your current Superannuation balance and your current income. They are simple to complete and can be a good indication of whether you are on track to achieve your retirement needs.

7/ For those who are employed but that earn less than $41,112 there is a Government “Co-contribution” equal to 50c for each $1 contributed to Super in after-tax dollars, up to a maximum of $500. This $500 maximum reduces for those earning above $41,112. Those earning more than $56,112 are ineligible.

8/ Consolidating Super funds is surprisingly easy, as the fund you are consolidating in to will do most of the work for you. Speak with your adviser about consolidating your funds, or to see if you have any lost super, visit the ATO website at

9/ Upon your death, your Super entitlements will not necessarily be paid to your estate. You are wisest to make BINDING DEATH NOMINATIONS or if you have a Pension account name a “Reversionary Beneficiary”. You should also make sure you change them as your situation changes, as you would a Will, e.g. perhaps in the event of a divorce.

10/ Upon your death, your taxable Super entitlements will be taxed at 15% if they do not go to a “death benefits dependent”. It is important to note that adult children are likely NOT considered a death benefits dependent. There are strategies to “recycle the taxable component” to reduce tax payable by your beneficiaries. Speak to a Hudson adviser to find out more.


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