2019 Top SMSF Tax Tips
Our list of top SMSF tips and changes to consider before & after 30 June 2019.
1. concessional contribution cap 25,000
This remains the maximum deductible amount for 2019, and needs to be received in the funds bank account before 30/6/19 (which is a Sunday this year). It can be deducted by an employer or personally (see below) or both, up to the cap.
2. unused cap amount
Any unused cap in 2019 now carries forward to later years on a rolling basis for 5 years. Its only available to a member with a Total Super Balance under 500,000 at the end of the prior year.
3. super tax threshold 250,000
Note that where the adjusted taxable income (ATI) of a member including deducted super contributions exceeds 250,000, the fund tax rate that applies to the excess will be 30% instead of the usual 15% under Division 293 rules.
4. non-concessional contribution cap 100,000
Non-deducted contributions up to 100,000 pa remain, providing your total super won't exceed $1.6m. They are not taxable to the fund. You can also bring this forward for 2 years to 300,000 per member. This cap excludes a new Downsizer contribution below.
5. downsizer non-concessional contributions
New for those over 65 who have sold their home in 2019 they can contribute up to 300,000 into super without affecting above caps. Applies to one home only, owned by you or spouse > 10 years, and paid within 90 days of settlement. Form needed.
6. small business cgt non-concessional contributions
The small business lifetime CGT cap is now $1.48m for 2019 and $1.515m for 2020, and doesn't affect the non-concessional cap. These contributions are sourced from the small business CGT 15 year exemption or the Retirement exemption. Form needed.
7. transfer balance cap of $1.6m
On retirement the amount you can transfer to exempt retirement phase remains $1.6m for 2019 and 2020. It is indexed but only in increments of 100k. The remainder must be held in an accumulation phase, which is still taxed at just 15
8. personal super contribution deductions
Any person under age 75 can make tax deductible personal contributions up to their cap of $25000 including employer super. If aged 65 a work test still applies for 2019. A Notice of intent to your fund is needed. Such deductions can't create an overall tax loss.
9. low income super co-contributions
This is a government co-contribution to your fund of 50% of your personal contributions, and up to a $500 is receivable. For 2019 it automatically applies if your taxable income was below 37,697, phasing out at 52,697.
10. low income super tax offset (LISTO)
A LISTO offset of 15% up to $500 may also be automatically received by your super fund if your ATI income was under 37000. It is based on 15% of concessional (deducted) contributions you or your employer has paid, making the tax payable on these nil.
11. low income spouse super offset
A personal tax offset up to $540 for spouse super contributions, if their ATI income is under 37000, phasing out at 40,000.
12. spouse contribution splitting
You may be able to split a prior year's contributions with a spouse, allowing a transfer, and preserving or utilising balance caps. Application forms needed.
13. franking credit refunds safe again
A common smsf strategy to get full investment returns, or cover tax on other income, these appear safe for now…
Important – above intended as a brief summary only, and other conditions or circumstances may apply.
Kind Regards
BCA Team
Last updated: 25/06/2019
