The new financial year has introduced several changes that SMSF trustees need be aware of to plan ahead and avoid any unexpected issues.
WHAT’S NEW FROM 1 JULY 2024?
Superannuation Guarantee (SG) rate increase
The new SG rate has increased to 11.5% (up from 11%).
Contribution caps for 2024-25
Both the concessional and non concessional contribution caps have increased from 1 July 2024 as follows:
| All ages | Last year’s cap (2023/24) | This year’s cap (2024/25) |
| Concessional Cap | $27,500 | $30,000 |
| Non-Concessional Cap | $110,000 | $120,000 |
Reminder: as contributions are assessed on a cash basis be careful of those contributions made in the last week of June 2024 which may have only hit the SMSF bank account in July 2024 as they will be counted towards your current 2025FY contribution caps. For example, employer or salary sacrifice contributions for the April – June 2024 quarter made on Friday 28 June 2024 but weren’t received until Monday 1 July 2024.
Carry forward concessional contribution caps
Individuals can make additional concessional contributions by utilising their unused concessional contributions caps on a 5-year rolling basis, as long as their Total Super Balance was less than $500,000 on the 30 June 2024.
Non Concessional Bring Forward Contribution cap
Members under the age of 75 on 1 July 2024 may ‘bring forward’ two years of non-concessional contributions subject to their Total Super Balance on 30 June 2024.
| Total Super Balance as at 30 June 2024 | Non-concessional contribution & bring forward available starting 1 July 2024 |
| Less than $1.66 million | 3 years ($360,000) |
| Greater than or equal to $1.66 and less than $1.78 million | 2 years ($240,000) |
| Greater than or equal to $1.78 and less than $1.9 million |
1 year ($120,000) |
| Greater than or equal to $1.9 million | Nil |
Government Co-contribution increase
The income eligibility threshold for Government Co-contributions will be $45,400 – $60,400 (up from $43,445 – $58,445), with the maximum entitlement remaining at $500.
LRBA Safe Harbour Interest Rate increase
For those SMSFs which have adopted the ATO’s safe harbour terms on their Limited Recourse Borrowing Arrangements (LRBAs) on real property, the interest rate will increase to 9.35% (up from 8.85%).
WHAT HAS STAYED THE SAME?
Total Super Balance Cap & Transfer Balance Cap
Both the Total Super Balance Cap and General Transfer Balance Cap have remained at $1.9m.
Every member will have their own personal Transfer Balance Cap depending on whether they have ever had a retirement phase pension or received a death benefit pension prior to 1 July 2024.
Unused Concessional Contributions Cap Carry Forward
For members whose Total Super Balance was less than $500,000 on 30 June 2024, they may be able to utilise their unused concessional contributions caps on a 5-year rolling basis from the 2020/21 financial year.
Work test for personal concessional contributions for individuals aged 67 to 74 years old
From 1 July 2024, the work test (ie. gainfully employed for least 40 hours over 30 consecutive days) will only apply if you wish to claim a tax deduction for the voluntary contributions you make to your SMSF, and this test can be met at any time in the financial year.
For individuals that are aged 75 or older, only the personal contributions made before the 28th day of the month after the month in which you turn 75 can be claimed as a tax deduction. For example, if your 75th birthday is 1 August 2024 then the personal contributions need to be made before 28 September 2024.
Author: Anna Wong – Senior SMSF Manager at Premier SMSF Solutions
*Correct as of 27 July 2024
*Disclaimer – Kreston Stanley Williamson has produced this article to serve its clients and associates. The information contained in the article is of general comment only and is not intended to be advice on any particular matter. Before acting on any areas in this article, you must seek advice about your circumstances. Liability is limited by a scheme approved under professional standards legislation.
