Meg's Musings – September 2024

We’re now well into our Super Intensive Day series with only one more live event and then the virtual day (12 September – don’t miss out if you haven’t registered already).

As usual, our team has loved catching up with clients and future clients in our face to face sessions and getting the usual adrenaline rush of presenting in-person to a packed out conference room. I’m only disappointed that we didn’t time our trip to Brisbane better and catch more of the Brisbane Festival and in particular the famous “Riverfire”. Especially since I had no idea (until now) that it’s sponsored by the Australian Retirement Trust. Given the superannuation link, it seems almost rude that we skipped town before it happened.

Thanks to everyone who has been along so far and provided all the great questions – as some of you know, often these make their way into future blogs, content in our Super Companion or even training programs. So please keep them coming if you’re attending one of the remaining events.

One thing I would have loved to be able to report by now is that we have a clear way forward on the controversial Division 296 tax (the extra tax on those with more than $3m in super). It seems egregious to me that something so momentous for the people impacted and so soon (if implemented, some things will change as early as 30 June 2025) should be still up in the air at this late stage. But at the time of writing, no such luck. The Government appears to be sticking to its guns and hoping to work its charms on the Senate cross bench. Or perhaps they will make compromises at the very last minute.

In my session at our Super Intensive Day I’ve speculated on some different variations we could see to the current approach for this tax and added those into my (excruciatingly extensive) modelling.

I have three hot takes. First, indexing the $3m threshold is important but is more about future generations of Division 296 taxpayers than those already there. Secondly, the deeming approach proposed by some in the industry would be great but is likely to result in much less tax for the Government and so possibly won’t be attractive. And finally, if the Government does end up going back to the drawing board and takes out some of the worst features of the tax (eg taxing unrealised capital gains), we also care a lot about exactly how that’s done. I shared a few different versions with very different tax outcomes.

I hope this issue is not still a “watch this space” next month.