Treasurer must keep promise to introduce super legislation this year
​Superannuation fund investors will be hoping that the Treasurer delivers on this week's promise to present the super change legislation in parliament by the end of 2016.
Executive chairman of Dixon Advisory
​Superannuation fund investors will be hoping that the Treasurer delivers on this week's promise to present the super change legislation in parliament by the end of 2016.
The changes in the asset test for the pension come at the same time as official interest rates and conservative investment returns are at historic low levels.
The draft legislation contains tough and in some cases unrealistic valuations of the non-commutable defined benefit pensions received by retirees.
Accumulation fund members are treated more harshly than defined benefit fund members under the new super rules.
Top marks to the government for dumping the deeply flawed proposal to introduce a backdated lifetime $500,000 non-concessional contributions cap.
Former public servants with generous retirement benefits face a grey area in determining how their pension will be taxed.
The government plans to remove the tax-free status of all income received by transition to retirement funds from next July, but they still have some benefits.
It's still uncertain how the proposed $1.6 million cap on pension fund accounts will be applied to defined benefit pensions.
Even though the government is still to finalise the precise details of the budget super changes, retirees have sufficient information to plan ahead.
While older retirees may be reluctant to dissipate large amounts of capital to retain their previous pension entitlement, the investment returns now provide compelling reasons to do so.
Search pagination