Heath Hill, Branch Manager - Morgans
There's no shortage of hysteria in the financial press surrounding the Government's proposed Division 296 changes to super.
The Government actually tried to get the Division 296 tax in place prior to the recent election and, while it passed the House of Representatives, it lapsed before it could become law. As it sits now, the Government has indicated it intends to reintroduce this legislation (potentially with the same start date of 1 July 2025), but final details are still to be confirmed.
So even though we don't know if and when it's coming into effect, let's at least try to understand what the Division 296 changes mean:
So what should you do right now? The answer is "nothing". Predicting politics is a fool's game. Until it is enshrined in legislation and we have full knowledge and understanding of what is happening and when it applies, there's no point making premature, knee-jerk reactions to newspaper hype.
And beyond that, let's not forget that we're talking about a tax on "earnings".
The only way to avoid that is to have zero or negative earnings (both of which are sub-optimal results). Everyone should do what they can to minimise their tax but, at the end of the day, it shouldn't be the primary determinant of our strategy. After all, the tail shouldn't wag the dog...
Please feel free to contact us if you have questions about any of this. There's also a technical piece from Morgans which provides greater detail, and we’re happy to forward this on request.
Please do not hesitate to contact us at: e: heath.hill@morgans.com.au
| ph:07 5581 5777 |
w: www.morgans.com.au
