By Phil La Greca
With tax time closing in it's now timely to look at a couple of important contribution-related issues.
The 2017/18 financial year is the first year that a much larger group of people will be able to claim a tax deduction for personal concessional contributions.
This is due to the removal of the so called “10%” rule – which previously limited tax deductions to people who were wholly or predominantly self-employed (i.e. those who derived no more than 10% of their income from salaried/waged work).
Now the rules are much simpler for claiming a tax deduction on personal super contributions. Either:
If you plan to claim a tax deduction you’ll need to formally notify your SMSF with a signed and completed “Notice of intent to claim or vary a deduction for personal super contributions”.
This needs to be done before you lodge your personal tax return for the year, or no later than the end of the next financial year.
Also remember the notice needs to be lodged before any part of the contribution is withdrawn or used to start a pension.
Your SMSF will then provide you with an acknowledgement which is evidence required for your personal tax return.
The key timing for superannuation contributions is that the money must be received by your SMSF by 30 June 2018. This year, 30 June falls on a Saturday so this mean that contributions need to be in the SMSF’s bank account by Friday 29 June 2018.
It is important to note that the timing is based on when the SMSF gets the money, not when it leaves your bank account. This means if you’re making a contribution online, leave enough time for the transfer process to complete. The timing will vary depending on both the sending institution and the receiving institution.
