Hello Chasers,
If you are looking to boost your retirement savings and reduce your tax bill, the undeducted carry forward strategy might just be the answer you’re seeking.
What is an Undeducted Carry-forward Concessional Contribution?
It’s a clever tax strategy that allows you to carry over unused concessional contributions (superannuation contributions that have not been fully maximised to the cap set by the ATO each year) from previous years to your current financial year. This can be especially beneficial for those who have hit their annual cap in the past or for those who want to make a larger contribution in a single year.
WARNING
This is general advice only as it has not taken into account your personal circumstances. It’s always recommended to consult with a financial advisor or tax professional to ensure you’re making the most of this strategy.
How Does It Work?
- Identify Unused Contributions: Check your super statements or MyGov account to see if you have any unused concessional contributions from previous years.
- Make a Contribution: Contribute to your super fund in the current financial year.
- Claim a Deduction: If your total contributions for the year exceed the annual cap, you can claim a tax deduction for the excess amount.
Why is This Strategy So Effective?
- Increased Retirement Benefits: By carrying over unused contributions, you can significantly boost your retirement savings.
- Reduced Tax Bill: Claiming a tax deduction for excess contributions can lower your taxable income and, consequently, your tax bill. This is particularly beneficial for those in higher tax brackets.
Key Points to Remember:
- Annual Cap: There’s an annual cap on concessional contributions. Make sure you’re aware of the current limit.
- Eligibility: You must meet certain eligibility criteria to use the undeducted carry forward strategy.
- Professional Advice: As with any matters involving tax, always seek advice from an expert BEFORE you do anything – it is good insurance against costly financial mistakes!
Ready to Take Action?
If you think the undeducted carry forward strategy is right for you, contact our office on 03-55612643 and we’ll help you to start by reviewing your super statements and considering your financial goals. With careful planning and expert advice, you can maximise your retirement savings and enjoy a more comfortable future.
Have a great day!
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