22 May 2023
Employers would be required to pay Superannuation Guarantee entitlements to employees on the same day as they pay salary and wages, rather than quarterly, under changes proposed by the Government in the Federal Budget 2023/24.
The measure is called payday superannuation and, if passed into law, is proposed to take effect from 1 July 2026. It is expected to benefit lower paid and casual workers who are more likely to miss out when their super is paid less often.
The Government estimates that payday superannuation will improve the retirement outcomes for about 8.9 million workers.
The Budget also included funding for the Australian Taxation Office (ATO) to crack down on the underpayment of superannuation.
This will enable the ATO to improve data matching capabilities to identify and act on cases of Superannuation Guarantee underpayment.
As expected, the Government pushed ahead with its plans to increase the tax rate for people with total superannuation balances of $3 million or more.
The proposed changes, which could take effect from July 2025, will levy a new tax of 15% of earnings on the proportion of an individual’s total superannuation balance that is greater than $3 million.
The existing tax rate of 15% will continue to apply to earnings while in accumulation phase, or 0% if held in a retirement pension account.
Defined benefit schemes will be included in the new regime. The Government said defined benefit schemes would be appropriately valued and have earnings taxed in a similar way to other interests.
The new measure is expected to affect about 80,000 people.
On the investment front, the Government announced it would seek to facilitate investment in sustainable industries through three new initiatives:
The announcements made in the Federal Budget are not yet law. As your superannuation provider, Brighter Super will keep you informed of any further developments with the proposed changes.
We understand these proposals may create uncertainty. We will ensure you have access to the latest information and support, helping you to make informed decisions about your super.
Brighter Super’s team of qualified professionals can provide advice and guidance on your superannuation and your future.
Our financial advice service can help you plan for a better financial future*. Members can receive limited advice on a single issue related to superannuation, at no additional cost. More comprehensive financial advice is also available, and fees will vary depending on the type and complexity of advice.
We also offer our members Super Health Check appointments over the phone or video call, at no additional cost. We look at your superannuation account, discuss different ways to grow it, and check that you are on track for a comfortable retirement.
Call us on 1800 444 396 to discuss the type of appointment that would suit you best.
This article has been produced by LGIAsuper Trustee (ABN 94 085 088 484, AFSL 230511) as trustee for LGIAsuper (ABN 23 053 121 564) trading as Brighter Super and may contain general advice, which has been prepared without taking into account your objectives, financial situation or needs. As such, you should consider the appropriateness of the advice to your objectives, financial situation and needs before acting on the advice. You should also obtain and consider the Product Disclosure Statement (PDS) and Target Market Determination (TMD) for your account before making any decision to acquire or contribute additional amounts to your LGIAsuper account – available to download at https://brightersuper.com.au or call us on 1800 444 396 to request a copy. References to Brighter Super may refer to the Trustee or LGIAsuper as the context requires. Brighter Super products are issued by the Trustee on behalf of LGIAsuper.
This article contains information that is up to date at the time of publishing. Some of the information may change following its release. Any questions can be referred to Brighter Super by calling us on 1800 444 396 or by emailing us at email@example.com.