|
If Meg invested $1,000 after-tax each year which was matched by the government co-contribution, in 25 years time she could end up with substantially more in her superannuation account, compared to investing the $1,000 outside the superannuation environment. You don’t need to be a maths expert to see the obvious difference co-contributions could make to your retirement savings!
But there’s more…
By taking advantage of the government co-contribution scheme you will not only help grow your super, but benefit from some handy tax savings. Any investment earnings generated through super are taxed at a maximum rate of 15 per cent. This is potentially a lot less than the tax payable on investments outside of super which is based on your personal marginal tax rate.
Can I take advantage of the government co-contributions?
There are a number of criteria that you need to meet to be eligible to receive the government co-contribution. You may be eligible for a super co-contribution in 2009/2010 if you meet the following criteria:
- you earn less than $61,920;
- you make personal after-tax contributions to a complying superannuation fund or Retirement Savings Account (RSA) by 30 June 2010;
- you are under 71 years of age at 30 June 2010;
- you lodge an income tax return for the 2009-2010 financial year;
- you are a permanent Australian resident for the entire financial year; and
- you receive at least ten per cent of your total income from eligible employment including income from self-employment.
The scheme works on a sliding scale - the less you earn, the more your co-contribution may be.
The maximum co-contribution of $1,000 is payable if you earn $31,920 or less in the 2009-2010 financial year and cuts out altogether when you earn $61,920 or more.
Claiming your super co-contribution couldn’t be easier
You don’t need to apply for the co-contribution. All you need to do is make a personal after-tax contribution to your super fund by 30 June 2010 and lodge an income tax return for the 2009-2010 financial year.
The Australian Taxation Office (ATO) will work out if you are eligible by using information provided by your super fund. The co-contribution will then be calculated and automatically deposited into your super account.
It’s that simple.
Next steps
It’s easy to make a personal after-tax contribution to your super fund via BPAY®, cheque or through your employer.
To make a payment via BPAY, click on the BPAY icon for instructions.
If you wish to make a payment by cheque, go to the Forms and Publications page to download and complete the Contribution form and mail it with your cheque to Plum .
Or to make a payment through your employer, talk to your Payroll / Human resources / Personnel Department (as applicable) about the various payment options available.
Remember, to qualify for the Government co-contribution, your personal after-tax contribution must be received by your super fund by Wednesday 30 June 2010.
Additional information
For more information on the Government co-contribution scheme please go to the Forms and Publications page and download the Government co-contributions strategy guide.
Alternatively, visit
www.plum.com.au or contact a Plum Member Services Consultant on 1300 55 7586, any business day, 8.00am to 6.00pm, Melbourne time.
| 
