The new Superannuation rules. including Transfer Balance Caps for Defined Benefit Pensions, including the 1.6m PSS Transfer Balance Cap and associated Transfer Balance Credit, are very complex and their effects should not be underestimated.
The new Superannuation rules are particularly harsh in relation to the way they assess the $1.6 Million Transfer Balance Cap against Defined Benefit pensions such as CSS, PSS, DFRDB and MSBS. Multiplying annual pension payments by 16, regardless of age, to determine the Transfer Balance Cap is excessive in our view and for senior long serving members of these schemes, holistic changes to superannuation arrangements are likely to be required before the 1 July 2017 deadline.
The new Superannuation rules are also quite harsh in the way contribution caps, for both concessional and non concessional contributions, are being reduced from 1 July 2017. For defined benefit members like contributing members of the CSS and PSS, the introduction of a PSS notional employer contribution will also adversely affect future salary sacrifice opportunities.
When you realise you are affected by the latest superannuation changes, it will be extremely important to promptly seek Financial Advice from a Certified Financial Planner to ensure you understand all of your options and can make any required changes before the 1 July 2017 deadline.
If you would like to enquire about a cost effective Financial Advice Health Check to ensure you optimise your options, including the $1.6m Transfer Balance Cap, click on the following link to contact us.
If you need assistance to optimise your situation, make contact quickly as time is running out......
PSS Transfer Balance Cap Financial Advice Health Check Enquiry
If you seek our advice, our goal is to assist you to understand where you need to go and what you need to do to get there, and you can then determine the level of assistance and support you require for your journey.
We look forward to our future journey with you.....
On 23 November 2016, the Australian Parliament passed the superannuation measures announced in the 2016 Federal Budget. As some of these changes are very significant, it is extremely important that you discuss your particular situation with your financial adviser and determine how these changes may affect you.
If you have unanswered questions, need a second opinion or want to confirm advice you have previously been given in relation to the superannuation changes or your PSS Transfer Balance Cap options, including for PSS Defined Benefit Pensions, we have all the answers!
Some of the key superannuation changes are as follows:
Additional summarised information on the dot points above has been provided by The Financial Advice Shop and can be accessed by clicking on the following link:
Legislated Superannuation Change Summary 23 November 2017
If you would like to read the Government's entire Explanatory Memorandum, click on the link below:
Australian Government's 2016 Superannuation Changes Explanatory Memorandum
The New PSS Transfer Balance Cap Legislation has implications for Transfer Balance Cap PSS as well as PSS Transfer Balance Cap. If this does not make sense, contact us to clarify the difference between PSS Transfer Balance Cap and Transfer Balance Cap PSS and lets not forger PSS Transfer Balance Cap Defined Benefit versus Transfer Balance Cap Defined Benefit PSS.