Q For a person aged between 65 and 74 who passes the work test of 30 hours in 4 weeks, can the person make concessional contributions into a super fund.
A To be eligible to make a Superannuation contribution past the age of 65, you are required to satisfy a work test. The test actually requires 40 hours of gainful employment over a 30 day consecutive period during the Financial Year in which the contributions are to be made. Gainfully employed means employed or self employed for gain or reward. Unpaid Charity work does not count. Note you must satisfy the work test before the contribution can be made in the Financial Year.
A Concessional Superannuation Contribution is one in which either an employer or the individual claims a tax deduction for the contribution. To be eligible to claim a tax deduction on a personal Superannuation Contribution, less than 10% of your assessable income including Fringe Benefits and Employer Superannuation Contributions can be derived as an employee.
To claim a tax deduction for a personal contribution, you must submit a notice of intent to claim the tax deduction to the Superannuation fund by the earlier of the time you lodge your tax return or by the end of the financial year following the year in which the contribution was made. Contributions tax at 15% will be deducted from the Superannuation contribution.
The maximum Concessional Contribution for the 2014-2015 tax year is $35,000 for those over 49 on 30 June 2014 and $30,000 for those younger.
The Concessional Contribution cap should not be confused with the Non-Concessional Contribution Cap. The tests operate exclusive of each other. The Non-Concessional Contribution Cap is $180,000 per financial year or if under 65, $540,000 every 3 years. To be eligible to make a Non-Concessional Contribution, you are still obligated to satisfy the work test. No Contributions Tax is payable on Non-Concessional Contributions.