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ejd99

1,500 Posts.

9

06/07/23

18:28

Post #: 68660498
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Originally posted by rebel1: ↑

A couple questions. If a person puts their own money from earnings, is the money classified as a tax deduction? This is for additional earnings not associated with main PAYG job. Therefore making the $$ non taxable . looking at this new fin year not the previous one.
Then the money put in, I understand is taxed at 15% ?
The next question, is that money then tied up in the super fund (A SMSF) until the person retires?
Or can the person make withdrawals on the money they put in as extra. If it can be withdrawn, what then would tax implications be?
As a scenario: A person this current financial year earns $100k from extra business activities in their own name . they put the whole $100k into their own super fund. At this point $15k needs to be paid in tax.

2 years time they want to withdraw $85k if they can. What are the tax implications ? Is it then classed as earnings?

Or is it better they Salary sacrifice from their PAYG income the $100k ?

I have read the amount that can be put in can be averaged over 5 years, so they can group the previous 4 years plus the current amount value in 1 year

Expand

I think this explains what you are trying to do?
https://www.ato.gov.au/Individuals/Super/In-detail/Growing-your-super/Claiming-deductions-for-personal-super-contributions/
We have never done this, so I am not familiar with the process.

Also, make sure you do not exceed the caps.
https://www.ato.gov.au/Individuals/Super/In-detail/Growing-your-super/Super-contributions---too-much-can-mean-extra-tax/

There is an option to perform non concessional contributions (also has caps), ie. your own money (not income etc)
https://www.ato.gov.au/Individuals/Super/In-detail/Growing-your-super/Super-contributions---too-much-can-mean-extra-tax/?page=5
We have done this and it was easy for us, as have a SMSF..

Everything contributed to super is locked in until preservation age with some exceptions -see below.
https://www.ato.gov.au/Individuals/Super/Withdrawing-and-using-your-super/Early-access-to-your-super/

The ATO web site is very helpful and has many examples.

Ahhhhh, the pleasures of running a SMSF LOL

Not financial advice, just my HO
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