Labor’s proposed super policies, here we go again !

We have seen significant changes made to super over the past few years, with the new ‘transfer balance cap’ and numerous changes to the contribution rules. With a federal election to happen by 18 May 2019, we outline the super proposals Labor is taking to the election.

The Labor Party proposes to make a raft of super changes if elected to government in the upcoming federal election.

The super policy changes proposed by Labor include:

What are the implications of Labor’s policies for SMSFs?

Labor’s proposed removal of franking credit refunds concerns many SMSF members.

Referring to Labor’s policy to ban SMSFs from entering limited recourse borrowing arrangements, SMSFs may only have a short window to establish new arrangements.

Contributing members can expect Labor’s proposals to further limit contributions by:

• Reinstating the limitation that individuals cannot deduct their personal super contributions if 10% or more of their income is from salary and wages;

• Lowering the non-concessional contributions cap; and

• Removing the new catch-up concessional contributions measure.Contributing members could review their contribution levels in anticipation of Labor’s proposed tightening of the contribution rules.

The Liberal National Party (LNP) have no new super policies for the next federal election. However, the LNP have made significant changes to super during its tenure–including the transfer balance cap and the limiting of super concessions for individuals with super balances of at least $1.6 million.