The start of a new financial year brings important changes to address and new opportunities to explore. Here are our top five money matters to consider for 2019/20.
Insurance in super
New laws that took effect on 1 July 2019 could impact insurance held in super. From this date, super funds are required to cancel insurance cover held in ‘inactive’ super accounts, unless the member has let the fund know they’d like to keep their insurance. Alternatively, the member can make a contribution or roll an amount from another super fund into their account. An inactive super account is generally an account that hasn’t received a contribution or rollover for over 16 months. Members impacted by this change who want to retain the insurance, should consider acting before the cover is cancelled.
Catch-up super contributions
Super fund members who made concessional contributions of less than the annual cap of $25,000 in 2018/19, may be able to contribute more than the cap amount in 2019/20 and beyond. Making ‘catch-up’ concessional contributions could appeal to people who have broken work patterns, can’t afford to contribute in a particular year or receive a windfall. Concessional contributions include all employer contributions (super guarantee and salary sacrifice), personal contributions claimed as a tax deduction and certain other amounts.
Super work test exemption
Recent retirees with lower super balances now have more time to make additional super contributions. From 1 July 2019, people aged 65 to 74 with a ‘total super balance’ below $300,000 no longer need to meet the ‘work test’ in the 12 months after they retire. If eligible for this once in a lifetime exemption, additional voluntary super contributions can be made without having to work at least 40 hours in 30 consecutive days during the financial year.
Work Bonus extension
Some significant changes have recently been made to the Work Bonus that could benefit people who are eligible for the Age or Service Pension and are still working. Since 1 July 2019, the maximum income that can be earned from employment without impacting benefits increased from $250 to $300 per fortnight. The Work Bonus is also now available to people who are self-employed.
Deeming rate changes
The ‘deeming rates’ used to assess income from certain investments for various social security benefits reduced on 1 July. Some people may now receive higher payments (such as the Age Pension, Disability Support Pension or Carer Payment) if their entitlement is determined by the income test. Lower deeming rates could also help some people to qualify for other income tested benefits, such as the Commonwealth Seniors Health Card or Low Income Health Care Card.
We can help assess whether any of these opportunities suit your needs and situation and make suitable adjustments to your financial plans.
 Certain requirements must be met before members can make ‘catch-up’ concessional contributions.
 On 30th of June of prior financial year.