The super co-contribution takes another hit

Further budget tightening announced by the Government today in the Mid-Year Economic and Fiscal Outlook strikes another blow to reduce the effectiveness of the superannuation co-contribution scheme.

It is proposed that from 1 July 2012 the co-contribution matching rate will be reduced from 100% to 50% with a maximum co-contribution of $500. This means eligibility will cut-out for people on adjusted taxable income of $46,920.

The proposed changes are outlined in the table below.

 

 

2011/12

2012/13

Maximum co-contribution

$1,000

$500

Matching rate

100%

50%

Lower income threshold

$31,920

$31,920

Cut-off threshold

$61,920

$46,920

 

The change is quite significant and will affect many clients with the government predicting to save $1.023 billion over three years.

Last updated 29 November 2011

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