Changes to the age for the Work Test was one of the superannuation announcements made by the Government ahead of the release of the 2019 Budget. The Government proposes that, from 1 July 2020, people aged 65 or 66 will be able to make voluntary superannuation contributions – both concessional and non-concessional – without having to meet the ‘Work Test’.
The Work Test restricts older Australians from making voluntary super contributions unless they have had 40 hours of gainful employment in 30 consecutive days.
“This means that Australians aged 65 or 66 years who don’t meet the work test, because they may only work one day a week or volunteer, will now be able to make voluntary contributions to their superannuation,” said Treasurer Josh Frydenberg.
“This will align the Work Test with the eligibility age for the Age Pension, which is scheduled to reach 67 from 1 July 2023.”
Around 55,000 Australians are expected to benefit from this change in 2020/21.
The Coalition had announced a complete repeal of the Work Test in a previous budget, but this was dropped to raise money for other measures. More recently the Government implemented a limited exemption from the Work Test.
“The Morrison Government is taking action to help Australians boost their retirement savings by giving them greater flexibility as they near their retirement years,” said Frydenberg.
Other changes to superannuation in the 2019/20 Budget at a glance:
- Raising the age at which the Work Test applies
- Extending non-concessional contribution bring-forward to ages 65 & 66
- Raising age limit for spouse contributions
- Streamlining ECPI
- SuperStream for rollovers for SMSFs delayed, rollover standard to be expanded
- Delayed start for Protecting Your Super insurance changes
- Extra funding for ATO to chase unpaid super
- Super fund merger tax relief to be made permanent
- Superannuation Consumer Advocate
- Funding for SCT to complete casework
- Choice for ADF Super members leaving forces
To read more, click see Sole Purpose Test
Get your FREE 5 Easy Steps to Plan Retirement One-Page planner from the Resources
Got questions? If you want experts who have years of helping others, without the hype – then call for a FREE strategy session today
No obligation call 0407 361 596, Paul
What are your thoughts? Start or continue the conversation here!