Tax changes may hit trans-Tasman transfers
Australians in New Zealand and Kiwis working across the ditch are being warned to check what impact recent Australian Budget changes might have on their superannuation.
Friday, May 13th 2016, 6:00AM
by Susan Edmunds
Tony Negline
The Australian Government has imposed a number of superannuation changes in its latest budget.
Among them are a new lifetime cap of $500,000 on after-tax superannuation contributions - those deposits made outside deductions from income.
It is also imposing a maximum pension balance of $1.6 million, and limiting the amount of contributions that can be made per year, with the tax concession applied, to $25,000.
Tony Negline, head of superannuation for Chartered Accountants Australia and New Zealand, said New Zealanders who were working or running businesses in Australia could be affected.
"If they are saving here and investing in the super system, some will need to rethink what they are doing, especially if they want to return to New Zealand to retire."
The $500,000 cap could also affect Australians who have left to work in New Zealand, saved money here and then wanted to transfer it back. That transfer could now attract a tax bill.
"If they wanted to retire and have money in KiwiSaver, they have got to be careful about how much they save in that system and how much they want to transfer because because there is a limitation on what can be put into the Australian system."
People on both sides of the Tasman should analyse the changes and how they might be affected, he said. "Otherwise there may be tax penalties. They need to assess how the new levels affect their plans."
Chartered Accountants Australia and New Zealand is calling for the Australian Government to review its policy and address the concerns of those who might be caught by the changes.
| « SFO tells clients to question advisers | LVR restrictions to be reviewed » |
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