In the 2019 federal budget, the Government announced its intention to increase the age at which the “work test” starts to apply for voluntary super contributions from 65 to 67. This amendment is now in place.
Prior to 1 July 2020, people aged 65 to 74, had to be in paid work for a minimum of 40 hours in any consecutive 30- day period in the financial year (the “work test”) to make voluntary super contributions.
This “work test” requirement did not apply to super contributions made before the person turns age 65.
The Government has now put in place amendments to this work test so that, from 1 July 2020, the work test only applies where voluntary contributions are made by those aged from 67 to 74.
The Government has said that this is to align the work test requirement with the eligibility age for the Age Pension, which is scheduled to reach 67 from 1 July 2023.
This change means that people aged 65 or 66, who don’t meet the work test, will still be allowed to make voluntary super contributions (both CCs and NCCs) – with the usual contribution caps continuing to apply.
This article contains information that is general in nature. It does not take into account the objectives, financial situation or needs of any particular person. You need to consider your financial situation and needs before making any decisions based on this information. If you decide to purchase or vary a financial product, your financial adviser, Hillross Financial Services Limited and other companies within the AMP Group may receive fees and other benefits. The fees will be a dollar amount and/or a percentage of either the premium you pay or the value of your investments. Please contact us if you want more information. Prosperity Wealth Advisers Pty Ltd (ABN 32 141 396 376), is an Authorised Representative and Credit Representative of Hillross Financial Services Ltd, Australian Financial Services Licensee and Australian Credit Licensee.