Wednesday, 14 May 2014 08:03

Budget 2014 - Option to withdraw excess non-concessional contributions from super

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Option to withdraw excess non-concessional contributions from superannuation

1 July 2013

The Government has proposed that individuals will have the option to withdraw contributions made from 1 July 2013 that exceed their non-concessional contributions cap.

Under this measure, associated earnings are also able to be withdrawn and taxed at the individual’s marginal tax rate. Final details of the policy will be settled following consultation with key stakeholders in the superannuation industry.

It is understood that individuals who do not withdraw their excess non concessional contributions will be subject to excess contribution tax at the top marginal tax rate on the amount of the excess. 

 

 

 

GEM Capital Comment

This proposal is good news as it will mean that clients who inadvertently exceed their non- concessional cap will have the ability to withdraw the excess amount rather than have it taxed at the top marginal rate. It also ensures the treatment of excess non-concessional contributions will be broadly consistent with the rules that apply to excess concessional contributions. 

 

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