The superannuation reforms first revealed in the May 2016 Federal Budget, are finally taking shape.
The main Acts have become law, and the draft Regulations were open for public comment until 10 February 2017.
It is clear that from 1 July 2017 the super landscape will have been altered in important ways. This article summarises the key changes.
What are the legal changes?
Some of the key reforms to the super laws include the following:
- imposition of a $1.6 million cap on the asset value of all fund accounts in pension phase;
- reduction of the concessional superannuation contributions cap to $25,000 per annum;
- reduction of the non-concessional contributions cap to $100,000 per annum;
- increasing access to income tax deductions for all individuals making concessional superannuation contributions; and
- introduction of the ability to 'bring forward' unused concessional superannuation contribution caps which can be rolled over for up to 5 years.
More in depth information on the changes is set out in our recent ClearLaw article "Superannuation reforms".
What changes have been made to the Cleardocs documents?
First, the pension terms have been revised in some meaningful ways. Primarily this requires changes to the pension document but also to some provisions of the deed relating to pensions.
Second, there are changes to certain rates, contributions caps etc which are more relevant to the PDS documents.
Third, there are changes of relevant to SMSF advisors in practice - eg. the low income super contribution offset and spouse contributions rules.
Fourth, there are those changes around the new pension commutation rules, and creation of reversionary beneficiary arrangements (such as through death benefit nominations and death benefit agreements).
Fifth, there are those changes which are of general importance and interest.
If you have more than 10 SMSFs to update, Cleardocs is happy to assist. Simply send us details of all the SMSF funds that need to be updated to firstname.lastname@example.org and we can prepare the orders for you.
Do I need to update my SMSF deed?
No, it is not necessary to update your trust deed but top 20 law firm, Maddocks recommends it.
If you have a deed from an earlier version, this does not necessarily mean your deed is outdated. However Maddocks recommends updating your deed to reflect current laws and best practice.
How do I update my deed to the latest version?
To update your, or your client's, existing deed to the latest version:
- log in to your Cleardocs account;
- click to start a new Update to SMSF order;
- select your fund on the pre-form page so we can pre-fill your order;
- complete your order and pay $99.00 to receive your updated replacement trust deed.
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