Transfer Balance Caps
[VIDEO] Private Client Adviser Mathew Ashton outlines the upcoming indexation change to superannuation Transfer Balance Caps.
Recap
The Transfer Balance Cap is the limit on how much money an individual can transfer from accumulation super account into a tax-free retirement pension account.
A single cap applies to an individual even if they have multiple pension accounts.
For the 2020/21 financial year, the Transfer Balance Cap is $1.6 million.
It is a one time limit – it applies throughout your lifetime – e.g. the total money you move on your initial transfer, combined with any subsequent transfers you make into your retirement accounts, are subject to the same overall cap.
What’s Changing
On 1 July 2021, the cap will be indexed by $100,000 to $1.7m. However, the amount indexed depends upon how much transfer balance cap you already have, by $1,000 increments.
Watch the video above to learn more.