The Treasurer has announced the superannuation package contained in the 2016 budget and the draft legislation will be changed by removing the proposed lifetime superannuation cap of $500,000 on non-concessional contributions (NCCs). However, anyone with over $1.6 million in super will not be allowed to make further NCCs from 1 July 2017.
The $500,000 lifetime non-concessional cap will be replaced by a new measure to reduce the existing annual non-concessional contributions cap from $180,000 per year to $100,000 per year after 1 July 2017.
Individuals aged under 65 will continue to be able to ‘bring forward’ three years’ worth of non-concessional contributions in recognition of the fact that such contributions are often made in lump sums.
The announcement does not change the proposed lowering of the annual concessional contribution to $25,000.
The work test on making additional contributions will remain for those aged 65 to 74. Individuals aged 65 to 74 who satisfy the work test will still be able to make additional contributions to superannuation.