Henry who? - 20/08/2009

Treasury Secretary, Dr Ken Henry, is due to hand down his report on the Austrlian tax system by the end of this year. The review announced on 13 May 2008 is meant to be a far-reaching look at the current tax system including all Commonwealth and State taxes.

What is in store for superannuation and SMSF's? The answer is simply that we do not know yet. What we do know is that no Australian government of either persuasion has left superannuation legislation untouched. In the May 2009 budget, we saw reductions in super co-contributions for low income earners and the halving of concessional contribution caps. Nick Sherry, the minister responsible for superannuation, has already conceded in a radio interview that the super system is not perfect and further reforms are coming.

Rumours have been reported in the press suggesting the possibility of only being able to access super as an income stream. Salary sacrificing into one's super is another area that it has been suggested may change as a result of the Henry Tax Review.

Superannuantion remains as a tax-effective investment. Whatever the Henry Report outcome, superannuation is here to stay but be prepared to see some changes.

Categories: