One important action is taking steps to even up the balances held by couples.
in their super account has certainly drawn much attention. Regardless of your views on the policy, it’s worth thinking about whether there are steps to take to prepare for it. What should those likely to be affected be doing now?
Certainly, many would be nervous about pre-emptively withdrawing large amounts from super right now. There is no chance of getting the money back in if this measure doesn’t happen – and even if it does, there are several years to make changes. At a purely technical level, withdrawing super now also risks removing key benefits.
In contrast, the earnings calculated for this new tax will include part of both the dividends and the growth. It’s worth bearing in mind that we wouldn’t see the full $1000 being taxed. If Sam’s super balance were $4 million, only 25 per cent would be taxed . But it’s certainly true that the earnings on which his tax would be based includes growth in assets that the fund hasn’t sold.
For example, if Sam is already retired or over 65, he could start withdrawing money from his own balance so that Jane can contribute it to her super account. Jane would need to be under 75 to do this and there are limits that prevent it from happening quickly.
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