A summary of the key tax and superannuation changes that became effective 1 July 2014 are as follows:
- Super Guarantee rate has increased to 9.5%.
As previously legislated, the Super Guarantee Rate increases to 9.5% on 1 July 2014. The compulsory contribution rate will stay at 9.5% for the next four years and then rise by 0.5% a year, reaching 12% on 1 July 2022.
- The cap for before tax contributions will increase to $30,000 (includes you employers contribution). For people who are aged 49 years or older on 30 June 2014 the cap will be $35,000.
- The after tax contributions cap will increase to $180,000 (if under age 65, you can contribution up to $540,000 in a three-year period. This period starts from the first year you add more than $180,000 to your super after tax).
- The maximum contributions base rise to $49,430 per quarter.
- Medicare levy will increase to 2% of taxable income.
- For those earnings over $180,000 a year, the Government has introduced a Temporary Budget Repair levy of 2% from 1 July 2014 to 30 June 2017. The levy will only apply to taxable income above $180,000, not the whole amount.
- Fringe Benefits Tax rate has increased 0.5% to 47% to reflect the increase in the Medicare Levy. From 1 April 2015, the rate will increase to 49%.
If you have any questions, please do not hesitate to contact your Harris Black team member.