A very brief summary of items in last week’s Australian budget that affect self managed superannuation funds:

The major revenue measures concerning superannuation proposed in the Budget included:

  • Excess contributions tax: The Government will
    provide eligible individuals who breach the concessional contributions cap by
    up to $10,000 with a one-off option to request that these excess contributions
    be refunded to them. This new refund option will only apply to first time
    breaches from 1 July 2011.
  • Minimum pension drawdowns: The minimum annual
    payment amounts for pensions and annuities will be reduced by 25% for 2011-12
    and will return to normal in 2012-13. In this respect, the Government will
    begin to phase out the 50% pension drawdown relief that has been provided for
    2008-09, 2009-10 and 2010-11 financial years.
  • SMSF regulation: To implement the range of
    “Stronger Super” reforms to the self-managed superannuation fund (SMSF)
    sector, the Government will provide $40.2m to the Tax Office and $8.4m to ASIC
    from 2010-11 to 2014-15. The cost of this measure will be offset by an
    increase to the SMSF levy from $150 to $180 with effect from the 2010-11
    income year and the introduction of SMSF auditor registration fees from 1 July
    2012.
  • Concessional contributions for those 50 and over:
    The Government will set the proposed higher concessional contributions
    cap at $25,000 above the general concessional cap for eligible individuals
    aged 50 and over with total superannuation balances of less than $500,000.
  • Other measures: Other superannuation measures
    announced concerned: SMSF trustee-director a parent or guardian of minor;
    superannuation co-contribution indexation freeze extended; greater use of TFNs
    for superannuation; and superannuation on payslips.

And finally, the annual fees for having your own fund , the supervisory levy, will increase from $150 to $180