Key benefits to boosting your super:

  • Low tax environment – Less tax taken means that your money grows faster in super by the phenomenon of compound returns.
  • Wealth Creation – Boosting super is likely to be part of your wealth plan, if you have surplus savings or assets then building your super may be wise as it can be a powerful investment vehicle.
  • Asset protection – Your money in super is largely protected from creditors including bankruptcy, if you are in business or face other risks this can be useful.
  • Retirement planning – The closer you get to retirement the more crucial building your super becomes because there are caps on how much people can contribute to super.

1. Add to your super – and claim a tax deduction.


If you contribute some of your after-tax income or savings into super, you may be eligible to claim a tax deduction.

This means you’ll reduce your taxable income for this financial year – and potentially pay less tax.

And at the same time, you’ll be boosting your super balance.

2.  Get more from your salary or a bonus by salary sacrificing


If you’re an employee, you may be able to arrange for your employer to direct some of your pre-tax salary or a bonus into your super as a ‘salary sacrifice’ contribution.

You’ll potentially pay less tax on this money than if you received it as take-home pay – generally 15% for those earning under $250,000 pa, compared with up to 47% (including Medicare Levy).

3.  Convert your savings into super savings


Another way to invest more in your super is with some of your after-tax income or savings, by making a personal non-concessional contribution.

Although these contributions don’t reduce your taxable income for the year, you can still benefit from the low tax rate of up to 15% that’s paid in super on investment earnings.

This tax rate may be lower than what you’d pay if you held the money in other investments outside super.

4.   Get a super top-up from the Government


If you earn less than $56,113 in the 2021/22 financial year, and at least 10% of your income is from your job or a business, you may want to consider making an after-tax super contribution.

If you do, the Government may make a ‘co-contribution’ of up to $500 into your super account.

5.   Boost your spouse’s super and reduce your tax


If your spouse is not working or earns a low income, you may want to consider making an after-tax contribution into their super account.

This strategy could potentially benefit you both: your spouse’s super account gets a boost and you may qualify for a tax offset of up to $540.

It’s important to note:

  • All of the above require you to meet certain eligibility conditions to apply these strategies.
  • We always recommend that you obtain professional advice before acting, you must understand the benefits and detriments of a strategy before you apply it.
  • There is limited time left to consider and act before 30 June.

VJC Wealth can help you decide which strategies are appropriate for you, if you have any questions please contact us.

Regards, Adrian and the VJC Wealth team.

General Advice warning: the information in this article is general in nature, it is not advice specific to your needs. If you want to act upon the information in this article then you should seek advice from a qualified professional. VJC WM accepts no liability to any party for acting from this information unless they have sought advice in a formal engagement with VJC WM for this purpose.