Federal Budget 2018-19

The Federal Budget for 2018-19 was released on 8 May 2018. We’ve summarised the main proposals impacting super, and we’ll keep you updated on these proposed changes through our website and regular employer newsletter.

Removal of automatic life insurance

The government is proposing that insurance included in superannuation be provided on an ‘opt-in’ basis for members:
  • with balances of less than $6,000; or
  • who are under the age of 25 years; or
  • whose accounts have not received a contribution in 13 months and are inactive.

The measure is effective from 1 July 2019 and these members will have 14 months from 8 May 2018 to opt in or their insurance cover will be switched off. These measures will apply to members who have received Death and Total and Permanent Disablement cover automatically.

Claiming tax deductions on personal contributions

Members who make personal superannuation contributions and want to claim a tax deduction will need to make an ‘up front’ declaration in their tax return. Importantly members will still need to send us the Australian Taxation Office (ATO) Notice of Intent to Claim form to claim a deduction. This measure will apply from 1 July 2018.

Voluntary contribution concessions for the newly retired

From 1 July 2019 the Government is proposing that members aged between 65 to 74 who are in their first financial year after their retirement and who have less than $300,000 in superannuation can make a voluntary superannuation contribution without needing to meet the work test. The work test prohibits people who work less than 40 hours in any 30-day period within a financial year from making voluntary contributions. Your employees can contact us to see how they can benefit from this proposed change.

Reuniting members with their lost and inactive superannuation

The Government is proposing to transfer all inactive superannuation accounts with a balance below $6,000 to the ATO. The proposal is designed to help reduce the erosion of superannuation fund balances as a result of fees from multiple accounts. In addition, the ATO will help people with inactive superannuation accounts to consolidate into their active superannuation accounts. Both measures will apply from 1 July 2019. Your employees don’t need to wait, they can consolidate other super into Rest now.

Lower fees for members with lower balances

The Government is proposing to introduce a three per cent annual cap on certain fees charged by superannuation funds on accounts with balances below $6,000 and will remove exit fees on all superannuation accounts. From 1 July 2019, it will not cost your employees anything to leave other superannuation funds to consolidate with Rest. However, they need to check if switching may affect their insurance.

Members earn more without impacting their pension

From 1 July 2019 pensioners can earn up to $300 per fortnight (up from $250) from employment without reducing their age pension payments under measures proposed by the Government.

This website is provided by Retail Employees Superannuation Pty Limited ABN 39 001 987 739, AFSL 24 0003 (Rest), trustee of Retail Employees Superannuation Trust ABN 62 653 671 394 (Fund), of which Rest Super, Rest Corporate, Rest Pension and Acumen are part. It contains general advice that has been prepared without taking account of your objectives, financial situation or needs. Before acting on the information or deciding whether to acquire or hold a product, consider its appropriateness and the relevant Product Disclosure Statement (PDS), which is available on this website. The cost of providing financial services is included in the fees in the Fund as disclosed in the relevant PDS. Rest and the Fund do not charge any additional fees or obtain any commissions for the advice provided. Rest’s employees are paid a salary and do not receive any commissions. They may receive a performance related bonus that takes into account the financial services provided. Super Investment Management Pty Limited (ABN 86 079 706 657, AFSL 240004), a wholly owned subsidiary company of Rest, manages some of the fund’s investments. Apart from this, Rest does not have any relationships or associations with any related body corporate or product issuer that might reasonably be expected to be capable of influencing Rest in providing financial services.

Rest personal advice is provided by Rest Advisers as authorised representatives of Link Advice Pty Ltd ABN 36 105 811 836 AFSL 258145

Awards and ratings are only one factor to consider when deciding how to invest your super. Further information regarding these awards can be found at rest.com.au/about-rest/awards. Past performance is not an indicator of future performance. SuperRatings Pty Limited does not issue, sell, guarantee or underwrite this product. Go to superratings.com.au for details of its ratings criteria. For further information about the methodology used by Chant West, see www.chantwest.com.au