With 30 June approaching, now is the time to ensure your clients are getting the best outcome from their super contributions. It’s vital to ensure contributions are received before the end of June.
For Individuals
For SMSFs, contributions need to hit the fund’s bank account before the end of June. Importantly, June 30 is a Sunday this year, so payments may need to be made as early as Tuesday 25 June to make sure they’re in the superfund’s bank account by the end of Friday.
If your client is contributing to a superfund other than an SMSF, they are required to allocate contributions within three business days of having received both the payment in their bank account and the contribution information. In this case, it would be prudent to make the payment a few days earlier, by about Tuesday 18 June, and ensure the fund’s preferred method is used for providing the contribution information.
This year also marks five years since the beginning of the carry forward concessional contributions. Therefore, any unused concessional cap space from the 2019 financial year must be used by 30 June 2024 or these amounts will lapse.
For Employers
An employer can generally only claim a deduction for superannuation in the year it reaches the employee’s superfund. For employers who use the ATO’s Small Business Superannuation Clearing House (SBSCH), PCG 2020-6 allows them to claim a deduction for payments made to the SBSCH by close of business on 30 June without checking when the superfund receives the contribution. It is important to note that this:
- does not apply to employers using commercial clearing houses; and
- only affects the employer’s tax deduction. If the superfund receives the contribution in July, it will still count towards the employee’s contributions cap for the 2025FY
Now is the time to ensure your clients know what their options are and how to take advantage of them.
If you have any questions about what documentation you’ll need to provide for audit, contact the AYS team today.