As we rapidly approach yet another end of financial year it may be timely for you to consider a little financial “housekeeping”. I have therefore listed a few important considerations depending on your own circumstances.


Firstly, for many individuals Superannuation is often an important consideration at this time of year. So, let’s look at some of the important issues remembering that this may not be relevant to your personal circumstances and so very important that you talk to your adviser or obtain personal advice relevant to you.

Concessional (Deductible) Super contributions:

  • The limit this year (20/21 FY) for personal deductible and employer super contributions combined is $25,000. Important to remember that some people are also claiming deductions on insurance policy premiums that are held inside super, this amount is also included in the $25,000 Deductible/employer limit.
  • For any contributions to count toward this financial year the contributions need to be made and cleared within the fund prior to 30/6/2021. We normally find that Super Guarantee employer contributions for June will normally only hit your fund after 30/6 and therefore only count toward next year’s limits. The same applies to last year’s contributions.
  • Any excess deductible/employer contributions over the $25,000 will firstly count toward what is called your non concessional (or after-tax contribution limit). Then the excess contributions will be taxed at your marginal tax rate as if you had received this amount as income and a small excess contribution charge of around 3% pa may apply. You may also elect to withdraw the excess contribution from the fund once the ATO has provided you with their determination post completion of your personal tax return.
  • In some cases, depending on your age, you will also need to meet a work test to make a super contribution.
  • Super contribution limits for next year (21/22) are increasing to $27,500 for concessional (deductible limits)
  • The employer super guarantee (SG) rate of super for this financial year is 9.5% increasing to 10% next year and will gradually increase to 12% over time.

Other Contributions and Limits

  • The Non-Concessional (tax-free) limit for this year is $100,000. Again, must be deposited before 30 June. Please ensure you have not triggered the 3 year bring forward rule in the previous 2 financial years.
  • Next year the limit increases to $110,000.
  • The other change here is that the cap on the amount of total superannuation that can be converted to a pension will increase from $1.6 to $1.7mil next financial year.

Superannuation pensions:

  • Important to ensure that you have taken the minimum pension prescribed for 20/21 year. This rate of pension depends on a combination of your balance as at the start of the financial year as well as your age. The Government decided that because of Covid 19 the pension rate would be halved this financial year. That is, if the minimum rate of pension in your case was 5% of the super balance, then you would only need to take out 2.5% as a minimum. Please contact us if you are unsure what this amount is.
  • Next year the minimum pension rate was due to end on 30th June 2021. The Government recently announced that it would be extending this reduction to the 21/22 year as well.  This does not mean that you must take the reduced level of pension, as you would still have the option of taking an amount above this minimum level.
  • Consideration may also need to be given, for those larger super balances, as to when you would look to commence a pension, if not already done so. The reason for this is that as mentioned in the previous section, the cap on how much you can have in a pension is increasing to $1.7mil from 1/7/21.

Other considerations:

Whenever we think about financial housekeeping, the other things that come to mind are investment, insurance, and estate planning.

  • June is a good month to review all your investments, not only superannuation. With a sharp rebound in many share markets over the last 12 months it may be appropriate to offset any capital gains against prior carried forward losses or rearrange your portfolio by selling a loss-making investment to offset realised gains obtained during this year.  Again, this depends on your individual circumstances as one size does not fit all.
  • At this time of year, it is also a good time to review your insurance policies to determine whether you have sufficient or perhaps too much cover depending on changed circumstances. Are you perhaps paying for insurance outside of super when it may be possible to have that inside super and be able to claim the premium as a tax deduction? Remembering that not all insurances can be claimed as a deduction.
  • By estate planning we refer mainly to wills and powers of attorney. Whilst not necessarily directly related to super or investment it is very important that you review these documents on a regular basis to determine whether they are still appropriate given any recent changes to your circumstances. Anything such as relationship changes for you or a family member, new addition to your family, asset purchases or sales, recent inheritances, death in the family or increased employment or business risks can be a trigger to re-examine your estate planning arrangements. Too often we find that people will complete their estate planning 5, 10 or even 20 years ago and then store it in the bottom drawer without any further reference. Inherent in its name, estate planning really is about forward planning. It is important that you regularly turn your mind to whether your current arrangements are still fitting with your wishes and your circumstances. Failing to put things in place and regularly review during your lifetime will likely result in increased costs and unnecessary complexities for the loved ones you leave behind. Please let us know if you or a family member would like to have your estate planning reviewed by our specialist department.

On behalf of the Quill team, I would like to thank you for your continued support during a financial year that was more challenging than most and which not only created some challenges for our clients but also our team. Let’s hope that next financial year sees a continued improvement on the economic front as well as an improvement in freedom of travel.


The information contained in this article is provided by Quill Group Financial Services in good faith and provides factual information and general advice only. No direct or implied recommendations are given in the material. It has been provided without taking into account your investment objectives, financial situation and particular needs. Before making a decision on the basis of any information contained in this article you need to consider whether it is relevant in your particular circumstances.