Hypothetical Superannuation Question Regarding Contributions Made in June and Hitting Super Account in July

Donaldhump on 31/05/2020 - 13:54
Last edited 03/06/2020 - 11:13 by 1 other user

background.

Have earned good money this year, and by time my employer makes their june SG payment (which they do every month ~middle of the month), I will have got pretty close to the 25k as I sacraficed the difference by design. My super is not a self managed one.

If i get my employer to sacrafice my last 2 FN pays into super, these will not hit my super account till mid next July.

so is this how this will work, as this is what I am trying to acheive.

A.) the sacraficed money will no longer be assessable income.
B.) the sacraficed money will go into next FYs contributions so as to not go over this FYs cap.
C.) the sacraficed money will get taxed at 15% once it hits the super / super fund deducts this.

I am petty sure this is sound, and sure its not illegal, just a matter of legal timing. ANyflws in this plan

essentially if i keep my job for another FY this is just delaying this till next year, but wouldnt mind buying some shares in my super while the prices down.

the Alex example in here seems like the scenario I want

https://www.superguide.com.au/retirement-planning/super-exce…

Financial Superannuation

Comments

  • bobbified on 31/05/2020 - 14:47
    +1

    There's a couple of things that you're relying on for your plan to work:

    1) The employer deducting your contributions this year and reporting it in the next FY (and not including it in your taxable income this FY)
    2) The employer not making the cut-off for contributions to the super administration company to be included in this FY.

    Each year as the FY year comes to a close, the super administration companies advise the employers of a particular cut-off date that the June contributions must be received by to be allocated in the current year. The date is usually a couple of days before 30 June. Administrators in the super companies will usually work overtime to process any contributions received on or before that cut-off date. Employers will often be prepared to put a lot of effort in to get those June contributions in.

    The reason is, members will often ring up and question any "missing" contributions if they're not allocated. It'll impact things like spouse or co-contributions, etc if they're not allocated by the cut-off.

    In short, it'll really all depend on your employer. You should be able to get a pretty good idea on whether your plan will work If you look at your June contribution from last year - did it get allocated in your super account in the correct FY or was it allocated in the new FY? To be sure, the best thing to do would be to speak to your employer on when they'll be making contributions to the fund.

    • Donaldhump on 31/05/2020 - 17:19

      Thanks, I’ll speak with my pay department and see what they say, unfortunately only worked there 10 months so don’t have last year to go off.

  • enigma48 on 31/05/2020 - 16:59

    It's easier these days:
    * If you don't use your full concessional cap, the unused amount now rolls over to next FY (https://www.superguide.com.au/boost-your-superannuation/supe…)
    * Make your own personal, deductible contribution: when you get paid you'll be taxed at your normal rate as usual. When it hits super it'll be hit for another 15% and you'll get your full tax back at tax time. Cons: need to wait until tax time, plus it requires paperwork: https://www.ato.gov.au/Individuals/Super/In-detail/Growing-y…

    In the past I've usually prepared a cashier's cheque on June 29/30th to be safe but with carry-forwarding it's easier now.

    • Donaldhump on 31/05/2020 - 17:16

      Yes I understand all of this, I guess instead of carrying forward unused cap, I’m trying to use next years in advance as this years is filled up. As comment above think I just need to speak with my pay department and make sure June’s sacrifice directly by my company gets put in after july 1.

      Thanks.

      Best loop hole I can think of too, is if it suits work overseas every 2nd year such as uk and do the same thing in both countries, carry forward the prior year too.works if it’s easy to uproot and leave and can get work easy enough. Ie not right now

      • blueyez on 04/06/2020 - 13:39

        'Trying to use next years in advance' makes zero sense.

        The date the money reaches the super fund is which FY it will fall into.

        The suggestion above of making your own contribution and claiming a tax deduction would mean you can control which FY it falls into as you wouldn't be relying on your employer. It is effectively the same thing as salary sacrifice.

  • pjetson on 31/05/2020 - 19:36

    My super is not a self managed

    and

    wouldn't mind buying some shares in my super

    Can you do that if you do not have a self-managed super fund?

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