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Federal Budget - what it means for your super

News | Date Posted: 8 December 2022

The Federal Government’s October budget made no major announcements about super, with the only change being a plan to expand the eligibility for the downsizer contribution.

For retirees, there were also measures to:

  • encourage pensioners to downsize their home, freeing up stock for younger families;
  • encourage pensioners to enter and / or remain in the workforce for longer;
  • expand access to the Commonwealth Seniors Health Card; and
  • freeze social security deeming rates until 30 June 2024.

 

More information on these measures

1. More people eligible for downsizer contributions: 

The minimum eligibility age for the downsizer contribution will be reduced to age 55 from age 60. The downsizer contribution scheme allows eligible homeowners to contribute up to $300,000 into their super from the proceeds of selling their main home. It’s designed to encourage older Australians to downsize their home sooner and increase the availability of suitable housing for Australian families.

  • Effective date of change: start of the first quarter after legislation receives Royal Assent.
  • More information: read our downsizer contribution factsheet. 

2. Incentives for pensioners to downsize their home: 

The proceeds from the sale of a main home will be exempt from the pension asset test for 24 months, increasing from the current 12 months. Further, under the income test the sale proceeds will be subject to the lower 0.25% deeming rate for 24 months after the sale.

  • Effective date of change: the 2022-23 financial year.
  • More information: MoneySmart website.

3. Encouraging pensioners into the workforce: 

Aged and Veterans pensioners will receive a one-off credit of $4,000 to their Work Bonus income bank. This top up will increase the amount pensioners can earn in 2022–23 from $7,800 to $11,800, before their pension is reduced. This means pensioners who want to work or work more can do so without losing their pension.

  • Effective date of change: the 2022-23 financial year.
  • More information: Services Australia website.

4. More people eligible for the Commonwealth Seniors Health Card and a freezing of deeming rates: 

To address cost of living concerns, from 2022–23, the income threshold for the Commonwealth Seniors Health Card will increase from $61,284 to $90,000 for singles and from $98,054 to $144,000 (combined) for couples. Social security deeming rates will also be frozen at their current levels for a further two years until 30 June 2024.

  • Effective date of change: the 2022-23 financial year.
  • More information: Services Australia website.

 

More information

For more information about the full range of budget announcements, see the Budget 2022-23 website.
 
As always, if you have any questions, please call us on 13 64 63, Monday to Friday, 8am to 6pm, email help@mine.com.au or contact your financial adviser. You can request an appointment with Mine Super Financial Advice to discuss your personal circumstances.