Federal Budget Update

We’d like to share with you a summary of last night’s Federal Budget which contained a number of proposals that may have an impact on your personal circumstances.

These measures are just announcements at this stage, and will not take effect until legislation is passed by Parliament. Most of the changes are slated for 12 months’ time at the end of June 2022.

In Summary, key items include:

• Proposed removal of the work test requirement for those aged 67-74 which would mean that you can continue to contribute to Super right up to age 75, regardless of whether you are working or not. We welcome this proposal which would create significant flexibility in contributing to super.
• Reducing the age requirements for the home downsizer contribution from age 65 to age 60.
• Increase the cap on the “First Home Super Saver Scheme” from $30,000 to $50,000.  This increases the scope for first home buyers to save for a home deposit tax effectively within Super.
• More generous Child Care Subsidy.
• Improvements to the Pension Loan scheme which allows those receiving an Age Pension to supplement their income using home equity.
• Much needed financial boost to the Age Care sector.

Overall, we see these changes as being positive for our clients, and introduce more flexibility to our superannuation system. For a more detailed commentary please see the attached Federal Budget Analysis.

Click Here to download Federal Budget Analysis.