2015-16 Legislative Updates: Superannuation
July 2 – by Angela Lehmann
Legislation Manager – Payroll & Tax, ADP Australia and New Zealand
It has been an anxious few weeks holding out for some key legislative measures to be passed for the financial year commencing on 1 July 2015.
Even still, some of the measures from the Federal Budget have not as yet been passed and the clock is ticking down towards the end of financial year. ADP has summarised some of the key tax and legislative measures relating to Superannuation below to help you keep track and plan for the 2015-16 year.
- Superannuation Guarantee Rate (SG)
The superannuation guarantee rate will remain at 9.5% for the 2015-16 financial year and will remain on hold until 30 June 2021.
Superannuation guarantee is the mandatory amount of superannuation contributions that an employer generally must make in respect of an employee (subject to certain limits discussed below).
The SG rate is applied to the employees’ ordinary times’ earnings amount.
- Maximum Contribution Base
The maximum superannuation contribution base is an upper limit used to determine the maximum superannuation guarantee that an employer is required to contribute.
The maximum contribution base will increase from $49,430 per quarter to $50,810 per quarter from 1 July 2015 or the equivalent of $203,240 annually.
This equates to the maximum SG for an employee in the 2015-16 being $4,826.95 per quarter or $19,307.80 for the year.
- Concessional Superannuation Cap
Concessional superannuation contributions include employer contributions (including those under a salary sacrifice arrangement) and personal contributions that are claimed by a self-employed person.
For taxpayers under the age of 50, the cap is $30,000 and those 50 years old or over the cap is $35,000. The cap is indexed annually in line with ordinary times earnings.
A persons age is for the purpose of the cap is based on those that will be 49 years old or older on 30 June 2015.
Tip: It is important to remind employees who salary sacrifice superannuation that they may be liable for excess contributions charge should they exceed the concessional superannuation cap within a financial year.
- Non-Concessional Superannuation Cap
The non-concessional superannuation cap will remain at $180,000 for the 2015-16 year. This cap relates to contributions made personally for which a deduction is claimed.
The superannuation rates and thresholds we have included in this section are the most common. For a more comprehensive listing, including further information, please refer to the ATO publication:
These legislative updates are current at the time of publishing, however please be aware that there are a number of Bills before Parliament as well as the White Paper on the Reform of Australia’s Tax System being undertaken that may impact you also. We will endeavour to keep you updated on key changes as the information becomes available.