The government has recently passed legislation to impose an additional tax on concessional contributions made by, or on behalf of, very high income earners. This additional tax is referred to as the Division 293 tax.
The Division 293 tax is an additional rate of 15% (to a total of 30%) on individuals whose income and relevant concessionally taxed superannuation contributions (referred to as low tax contributions) is more than $300,000 a year.
Income for Division 293 tax purposes includes taxable income, reportable fringe benefits, reportable superannuation contributions and total net investment losses. A member’s low tax contributions include employer and member (before tax) contributions and notional employer contributions for defined benefit members.
Please contact us for more information on the impacts of this legislative change.