As from 15 September 2016, the current Budget 2016 superannuation proposals include:
- the introduction of a transfer balance cap of $1.6 million on amounts into the tax-free retirement (pension) phase from 1 July 2017.
- after commencement, if individuals already in retirement as at 1 July 2017 retain balances in excess of the $1.6 million cap and do not transfer the excess out of the retirement phase account, a similar tax treatment that applies to excess non-concessional contributions will be applied to that excess at the top marginal rate of tax (ie 49% for the 2014 to 2016 income years);
- introduction of commensurate measures to defined benefit arrangements;
- removal of the tax exemption on earnings which support Transition to Retirement Income (pension) streams.
On 15 September 2016 the Government abandoned the following proposal:
- establishment from 3 May 2016 of a life-time non-concessional contributions cap of $500,000 on all non-concessional contributions made since 1 July 2007.