Media Release
Should I start a second super fund?
14 June 2007
THIS issue is currently top of mind for many superannuants as the taxable and the tax exempt components of superannuation are set to become indissoluble from 1 July.
“For many, the answer to this question is a resounding YES,” says superannuation expert, Martin Murden. He is also director of Partners’ Superannuation Services, part of the Partners’ Group of companies.
He says those ideally placed to start a second fund are:
For the first group, if their taxable pension or taxable lump sum in the 2007/08 tax year does not exceed $38,684 or $140,000 respectively, they will not pay tax. However, once it goes over this threshold, they will be taxed at 16.5%.
Similarly, for adult beneficiaries, every dollar of their taxable benefit will be taxed at 16.5%.
Mr Murden says in both instances the tax burden will be alleviated by splitting their existing fund into two separate funds. “This will enable them to place their tax exempt money in one and the taxable component into the other.
“In the case of 55-59 year olds, this allows them to determine just how much they will draw from each. For example, should they wish to take a lump sum of $200,000, they would take no more than $140,000 from the taxable fund and remainder from the tax exempt one.
“Where those taking care of their beneficiaries are concerned, having two funds enables them to live off the taxable component, while leaving the tax exempt part relatively in tact.”
However, Mr Murden says for this approach (pre 30 June) will only be truly successful if:
-
The superannuant has a large amount of undeducted contributions or has rolled over money to take advantage of the small business concessions, or
-
The superannuant intends to make a large undeducted contribution in this tax year which can be transferred into the second fund.
And in both instances, these monies should be transferred into the new fund prior to 30 June.
More about Martin Murden …
He is one of Australia’s leading authorities on self managed superannuation funds (SMSFs) with over 35 years experience in financial services. A CPA, he has specialized in the area of providing superannuation advice. He is also a director of Partners Superannuation Services.
For more media information contact:
Martin Murden on 03 8508 7800 or 0416 186 589
Wendy Parker on 0422 694 503.
|
