Super Co-Contribution Free money from the Government

How would you like up to $500 tax free paid into your superannuation fund by the Federal Government?

Well maybe you, or someone in your family, qualifies for this $500 tax free offer.  This is what the Federal Government calls “Super Co-Contribution”.

And it is free money.  This Super Co-Contribution is a payment by the Federal Government to your superannuation fund and:

• Is not subject to tax when it is paid to your super fund.
• Is not included as income in your tax return.
• But is retained in your super fund and can only be accessed when other preserved amounts can be accessed.

How much free money can I get?

If your total income is $36,813 or less, the government will contribute 50% of any eligible payment you make to your super fund up to a maximum of $500. For example if you contribute $500 in after tax money, the government will pay $250 to your super fund. If you pay $1,000 in after tax money, the government will pay $500 to your super fund. If you pay $1,500 in after tax money, the government will pay $500 to your super fund.

If your total income is between $36,813 and $51,813, the amount the government pays to your superfund gets reduced by 3.333 cents for every dollar your total income exceeds $36,813. For example if your total income is $40,000 and you paid $1,000 into your super fund the government will pay into your superfund $393.77 (being $500 – [($40,000-$36,813) x 0.033333)].

How do I know if I am eligible to get Free Money from the Government?

To be eligible to receive this payment for the 2017 – 2018 year the conditions are:

• Your super balance must be below the Balance transfer cap of $1.6 million as at 30 June 2017.
• Your total income must be less than $51,813 in the 2017-2018 tax year. The government defines your total income to be your taxable income plus any reportable fringe benefits plus any salary sacrifice super contributions (not the employer 9.5% super component paid on top of your taxable income) less any allowable business deductions.
• You must make the payment(s) to a complying super fund before 30 June 2018. Note you can pay this in instalments as long as the money is in your super fund account on or before 30 June 2018. You may need to make any payments well before this date to ensure that your super fund processes these payments – If you are going to do this please speak to your superfund to ensure that your payment is received in time to be processed by the superfund by 30 June 2018.
• This payment must not have been claimed as an income tax deduction (i.e. you made the payment out of post taxable income).
• 10% or more of your total income must come from employment-related activities, carrying on a business or a combination of both.

Just remember your payment needs to hit your superfund by 30 June 2018 to get the super co-contribution.

If you want more tips and ideas of how to improve the health of your wealth and get off the treadmill of working till you drop, why not join my meetup group and get notice of my upcoming live and free events.  Simply click below.

If you like this, why not share this with a friend, simply click on one of the icons to the left or below

Do you and your family a favour and start taking steps so you can improve the health of Your Wealth and get off the treadmill of working till you drop.

Wayne Wanders

The Wealth Navigator

wayne@thewealthnavigator.com.au

If you like this, why not share this with a friend, simply click on one of the icons to the left or below