In July 2013 we reported to you changes to superannuation and in particular, changes to superannuation contribution caps.
The Australian Taxation Office has recently released the latest Superannuation Thresholds which will now apply for the 2014/15 financial year, i.e. starting from 1 July 2014.
The 2014 / 2015 thresholds will be as follows;
With respect to the Government Co-Contribution:
Please note that there will be NO change to the Low income superannuation contribution of $37,000 as this income threshold is not indexed by AWOTE. (There is pending legislation to abolish this co-contribution in respect of 2013/14 and subsequent financial years.)
Pensioners - There will be NO change to the percentage of Account Based Pensions that must be drawn as a minimum.
Continuing with the legislated increases to the Super Guarantee rate; the SG payment will increase to 9.5% from 1 July, previously 9.25%. (There is also pending legislation that if passed will see the SG rate stay at 9.25% for 2014/15 and 2015/16.
This change to the SG rate will have an impact to both employers and employees.
With the unfortunate increase in redundancy payments being made presently, it will be important to note the changes to Eligible Employment Termination. The tax rates will be indexed to rise from 1 July 2014. They will rise as follows;
It is important that you understand what each of these changes means to you and how you might change your arrangements to maximise your overall position.
We strongly recommend you contact Financial Keys if you are unsure as to what and how each of these changes might impact you.
The Australian equity market started the year with great gusto with key economic metrics broadly supporting the market. This swiftly turned in February and the local bourse continued to fall throughout the remainder of the quarter. The slide was largely due to the uncertainty over US President Trump's tariffs. Fear and speculation finally became reality as the index began its steep decent in early February, falling circa -10.3%; an official correction and potentially heading towards bear territory and global recession. The Australian market reacted sharply and negatively to the Trump tariffs during the March quarter and overall experienced its steepest losses since the onset of the COVID-19 pandemic. The Australian equity market ended the quarter down (-2.8%).
Although we haven’t received any calls, as we suspect most people are quite familiar with market volatility over the years, we thought this update would put some recent market movements into perspective.
It was a nervous start to the quarter for the Australian equity market (ASX 200), as the impact of China stimulus measures and implications of rising bond yields was being digested. The resources sector felt the brunt of this nervy start falling over 5% for the month of October, however the broader market did manage to reach an all-time high on the 15th of October closing above 8,300 for the first time.