Andrea Slattery – CEO – SPAA
The SMSF Professionals’ Association of Australia (SPAA) CEO Andrea Slattery says the Federal Government’s superannuation announcement today was a step in the right direction to “depoliticise” the superannuation system.
“We appreciate that the Minister for Financial Services and Superannuation, Bill Shorten, was willing to listen to our concerns and acted on most of them, particularly to the discriminatory sector specific proposals targeting SMSFs,” Mrs Slattery says.
“As a result of this pre-budget announcement there is now far more certainty around the superannuation system – in sharp contrast to the speculation of previous months.”
“In particular, SPAA welcomes the announced increase in the concessional cap for the overs 60s this year, and the over 50s next year, which will assist Australians close to retirement, particularly women and those with broken work patterns, through the ability to contribute and build a more dignified and self-sufficient retirement.
“SPAA has led the charge on this issue after the cap was reduced in the 2009 Federal budget, and in 2011 co-ordinated a joint industry letter calling on the Government to increase the concessional cap to $35,000 for individuals over 50.”
SPAA also welcomes the changes to the excess contributions tax regime that enables individuals to seek a refund of their excess concessional contributions.
“Unlike the current regime, this measure will not be limited to excesses of less than $10,000 and will not be limited to a once-off refund.”
But she added a note of caution. “We believe a similar refunding option should apply to excess non-concessional contributions as it is the excess non-concessional contribution breaches that usually attract significant excess contributions tax and the current options available to members who breach their non-concessional cap are grossly inadequate.”
Mrs Slattery says the Government’s decision to set up a Council of Superannuation Custodians to provide certainty and a bi-partisan political approach to super is a positive development.
“SPAA has always called for super to be sacrosanct, and the establishment of this council is a step in that direction by helping recommit to the objectives of superannuation, and to have a bipartisan approach to super as the long-term Australian retirement savings vehicle.
“This council can also address the serious issue of what the ‘true cost of superannuation’ is rather than policy being developed based on tax concessions alone.”
SPAA acknowledges the issues around sustainability and equity, but is concerned about the some of the additional complexities and costs to super with the new earnings tax measures.
“We would expect to work closely with Government on the details of this particular measure, and all other issues pertaining to superannuation in the future.”
On the changes to the taxation treatment of deferred lifetime annuities, SPAA is concerned about product and industry distortions if these income streams are not subject to the same earnings tax treatment as superannuation income streams.
