Wednesday 26 April 2017

TAX DEADLINES ARE APPROACHING



The 15 May Tax agent Lodgement Extension is fast approaching.

Please contact us to discuss your outstanding 2016 income tax returns.


See below link to ATO website for more information on 15 May deadlines:

https://www.ato.gov.au/Tax-professionals/Prepare-and-lodge/Due-dates/May-2017/

Please contact Andrew Marshall or Janine Orpwood at Langley McKimmie Chartered Accountants on (03) 5427 8100 to discuss further.

 We provide accounting and wealth management services to clients in WoodendGisborne and Macedon Ranges areas within Victoria Australia.  

Wednesday 19 April 2017

DEFINED BENEFIT PENSIONS & $1.6M SUPERANNUATION TRANSFER BALANCE CAP


With all of the talk around the $1.6m superannuation transfer balance cap, something that hasn’t been discussed a great deal in the media is around the treatment of defined benefit pensions in relation to the cap. The application of the cap differs depending on whether the pension is sourced from taxed funds (generally private sector funds and some public sector ones) or from untaxed sources (some public sector funds). If you are unclear if your pension account fits one of these descriptions contact your superannuation fund and they can confirm. 

You can establish if a defined benefit pension will be valued at over the transfer balance cap limits by multiplying the amount received annually by 16. Therefore if you receive a pension from a defined benefit fund at or over $100,000 you will be considered as using up all of your cap.  

The taxation treatment is therefore as follows:  

Untaxed Defined Benefit Pensions – 100% of pension amounts over $100,000 will be included in the taxpayers assessable income taxed at marginal rates, and the 10% offset available will be capped at $10,000.  

Taxed Defined Benefit Pensions – 50% of pension amounts over the current cap of $100,000 will be included in the taxpayers assessable income at marginal rates, no offset is available.


Please contact Andrew Marshall or Janine Orpwood at Langley McKimmie Chartered Accountants on (03) 5427 8100 to discuss further.

We provide
accounting and wealth management services to clients in WoodendGisborne and Macedon Ranges areas within Victoria Australia.
  

 

Wednesday 12 April 2017

Wednesday 5 April 2017

DOES THE $1.6 MILLION SUPER PENSION CAP AFFECT YOU?


 
From 1 July 2017 members with superannuation in pension phase are subject to a $1.6 million transfer balance cap. This means that:   
 
  • The maximum amount a member can have in pension phase is $1.6 million (across all super accounts).
     
  • Amounts above $1.6 million need to be withdrawn from the fund or commuted back to accumulation phase.
       
  • If funds greater than $1.6 million are left in pension phase, additional tax will be levied on the excess amount.
     
  • Earnings on amounts in pension phase remain tax free, whilst those in accumulation phase are taxed at 15%.  
 
Example:
  
John has $1.8 million in pension phase in super split between two funds, $1.4 million in fund A and $400,000 in fund B.
 
To comply with the changes, John applies to fund B to commute $200,000 back to accumulation phase before 1 July 2017.
  
This ensures that John’s remaining pension balance across both funds of $1.6 million is tax free and that no excess transfer tax is levied.
  
Please note special rules apply to defined benefit pensions.
 

Please contact Andrew Marshall or Janine Orpwood at Langley McKimmie Chartered Accountants on (03) 5427 8100 to discuss further.

We provide
accounting and wealth management services to clients in WoodendGisborne and Macedon Ranges areas within Victoria Australia.