Early Access to Your Super

[Deactivated] on 05/04/2020 - 21:26
Last edited 05/04/2020 - 22:03

This will be available as from the 20th of April but you can register your interest now by logging in to your myGov account and following the Intention to access coronavirus support instructions.

Has anyone done it or planning to do it?

Is your situation so dire that you couldn't make ends meet without it?

JJB

Added a poll : Are you going to access your super? Why?

Edit: The tax loophole

To take advantage of the tax loophole, beneficiaries would need to fit into a rather specific cohort of earners:

  • qualify for early release of super, which means having been made redundant in the coronavirus crisis or, in the case of sole traders, having lost at least 20 % of turnover.
  • a working-age individual who is on 9.5% compulsory super contributions,
  • has an annual salary below $158,000,
  • has made no previous voluntary contributions to super in 2019-20, and
  • who elected to make a “simultaneous” (within 2019-20) pre-tax contribution to and withdrawal of the maximum possible $10,000 from super over the next three months.

As long as an individual in this situation has an annual income of approximately $30,000 or more, there is a prospective tax saving from rearranging his or her financial affairs over the next three months.

Poll Options

  • 38
    Yes, I need the money.
  • 19
    Yes, for the tax loophole.
  • 145
    Nope, terrible idea.
  • 11
    Other
Financial Superannuation

Comments

      • jimbobaus on 05/05/2020 - 21:31
        +7

        Cousin works at the ATO
        He is working on the COVID-19 team
        They have literally allocated zero resources to super withdrawal policing.

        • bobbified on 05/05/2020 - 22:20
          +1

          They have literally allocated zero resources to super withdrawal policing.

          Weren't you saying before that they were setting up a team to target certain elements of this policy?

          And like I was saying here before, they're directing all their attention to target those who are trying to rort the JobSeeker and JobKeeper schemes.

          Having said that, I personally still wouldn't try and make a false declaration around the eligibility criteria though.

          • Zachary on 06/05/2020 - 08:33

            @bobbified: Oooooooooooooooh, we got him boys!

            Probably was bullshitting just to scare everyone here off…..or maybe this is the bullshit to goad people into doing it now and then later get (profanity) for it…

            • jimbobaus on 06/05/2020 - 10:45
              -2

              @Zachary: sadly you did not and i was not
              My comments were about two very different things

          • jimbobaus on 06/05/2020 - 10:45
            +1

            @bobbified: did you read the comments?

            I said they are targeting people who try and gain a tax break by re-depositing their super
            they are NOT auditing anyone who simply withdraws their super.

            • bobbified on 06/05/2020 - 13:14

              @jimbobaus: I really don't know where you get your information from.

              They're not doing it now, but they will eventually audit the eligibility criteria. It is the withdrawal-and-recontribition that won't be audited, simply because they know cannot prove someone's intentions.

              I have been running legislative change projects in the superannuation industry for years and my teams work directly with the ATO.

              • jimbobaus on 06/05/2020 - 14:46

                @bobbified: Deleted my comment as i have been told to not talk about it anymore.
                But my points are valid and i have confirmed them and shown yours, and all i will say is they have systems to detect when people withdraw/redeposit for a tax break

                • cloudy on 10/05/2020 - 22:28
                  +1

                  @jimbobaus:

                  they have systems to detect when people withdraw/redeposit for a tax break

                  just wondering, what level of knowledge does your cousin actually have? an APS level would provide some guidance.

                  from what I know of the legislation ,there is no provision dictating what one can do with the early release of this super. You can spend it on food, hookers or put it back in super its no ones business.

            • bluesky on 27/05/2020 - 16:44
              +1

              @jimbobaus:

              they are targeting people who try and gain a tax break by re-depositing their super

              I agree exploiting this is not a very good idea – I commented about this yesterday (late to this post to comment).

              I find it a bit puzzling why some people take the attitude that ATO must be able to prove and action against you before it is a bad move to exploit a loophole that ATO never intended or frowns upon.

              Just getting on their radar, to me, is already one step closer to a problem or potential headache. ATO is a party you have to deal with most of your life. Being flagged as a higher risk for tax evasion could mean closer scrutiny in future tax returns.

              ATO tax intake will definitely drop significantly due to COVID, they could come down much harder than before, in order to boost intake. This trend was already happening before COVID (ATO looking at how much $300 claims without receipts were costing them, laundry expenses, etc).

              To me, it makes sense not to tempt fate, but to have an unblemished record. So many things we cannot control in life, who knows when you need to rely on "banked credits" or a "good reputation" with them, so to speak.

              Sort of like a rap sheet. If you haven’t got one, and some unfortunate stuff happens, just by mitigation or leniency, you might get off lightly. But if you already have previous incidences or suspected incidences, law enforcement will come down on you harder.

              I read quite often about those who get fined/go to jail due to ATO fraud (am on their mailing list). These are the people who must think ATO will never catch up to them.

          • latte on 06/05/2020 - 12:44

            @bobbified: Just FYI job seeker is Services Australia domain, not ATO.

        • RockyRaccoon on 05/05/2020 - 22:33
          +1

          For the moment, but after this they can still follow up.

          7 years or more

    • plmko on 05/05/2020 - 20:06
      +4

      False declaration is fraud, fraud means unlimited investigation periods.

      Thousands might get away with it, but they will always have to sleep with that little nagging feeling that things can be undone at anytime.

    • jelko on 05/05/2020 - 20:19
      +1

      Anybody who takes out money during this time should make it a priority to repay it as soon as they are able to and it's a terrible idea to take out money when the market is down by at least 20%. It actualizes your losses while for everybody else it will just be a blip on their retirement savings.

      • whooah1979 on 05/05/2020 - 20:23
        -3

        Hedge it with silver, gold and btc.

        whooah1979 on 05/05/2020 - 20:23 (Collapsed - Offtopic. Show)
      • [Deactivated] on 05/05/2020 - 20:44
        +1

        It depends.

        Give me $20k and I'll make more from it.

        Super is just lost opportunity for some.

        • TEER3X on 05/05/2020 - 21:13
          +2

          Selling ice is pretty risky though. Like all investments, there is a risk-reward tradeoff. Your risk is jail and getting bumfacked

          • [Deactivated] on 05/05/2020 - 21:13
            +3

            @TEER3X: How did you know I was in the refrigeration business and when was it outlawed?!

            • TEER3X on 06/05/2020 - 11:17
              +1

              @[Deactivated]: Your name is Michael and you were on married at first sight. You got shafted and rightly so.

              • [Deactivated] on 06/05/2020 - 11:18
                +1

                @TEER3X: Brb. Googling reference.

                Edit - a cursory glance of the headlines does not make your reference any more relatable. Was expecting to be informed this Michael character is a refrigerator touting Smeg senior executive.

                • [Deactivated] on 06/05/2020 - 15:40
                  +1

                  @[Deactivated]: Need to work on your googling skills. First thing that came up was:

                  Michael is the owner and Director of Adelaide Ice, South Australia's largest ice manufacturing and packaging business, after having purchased a local company a couple of years after his arrival in Australia.(..)

                  For those not across the intricacies of the South Australia ice cube business, Adelaide Ice is the largest ice manufacturing facility in South Australia. They also operate in the Northern Territory under NT ICE and Queensland and Victoria under Arctic Ice.

                  2nd search result was this - the moment he found out that his 'wife' cheated on him with someone else's 'husband' on their 1 month anniversary.

                  How does that old saying go ? Lucky in ice, unlucky in love?

    • whooah1979 on 05/05/2020 - 20:20
      +2

      A close buddy did it.

      Why do you have a problem with your mate accessing their super?

      Did they say myob when you asked?

      • [Deactivated] on 05/05/2020 - 21:15
        +5

        He asked him how much do you have in there

        He answered xero

    • ode1online on 05/05/2020 - 21:02

      Good luck to him..

    • LemonShapedRock on 05/05/2020 - 22:03

      The 20% reduction in working hours is an interesting one, I wonder why they didn't specify income?

      If you took a day or two of love without pay wouldn't that technically qualify you?

      Interesting to see whether the ATO cars tough about this to audit. With Single Touch Payroll it'll surely be easy to measure drops in income.

      • Donaldhump on 05/05/2020 - 23:07
        +6

        if someone gives me a day or two of love ill give them some of my super

    • vikvance on 06/05/2020 - 00:16
      +1

      It's their money and it will be paid back to them at some point … whether now, or later when they reach retirement age.

      If they choose to withdraw it now, then that's their choice.

      • Donaldhump on 06/05/2020 - 00:30

        They are committing tax fraud if not eligible, punishable by fines and a possible criminal record (unlikely)

        • vikvance on 06/05/2020 - 07:03
          +1

          It's not really "tax fraud" if a person just withdraws the money & doesn't put it back into Super as an additional voluntary contribution.

          "Tax Fraud" implies someone paying less tax than they are supposed to be paying.

          The Super money has already been taxed once at 15% when it was first put into Super. There is no direct tax loss to the government if someone withdraws the money early because that 15% tax is not returned when the money is taken out.

          • Donaldhump on 06/05/2020 - 08:07
            +2

            @vikvance: Of course it is tax fraud, as Early withdrawals due to hardship are taxed at 15 percent.

            This is tax fraud as the gov has made an exemption during this time to make it tax free if you meet the criteria

            So they are paying less tax than they are supposed to be

          • BigBirdy on 06/05/2020 - 08:23
            +1

            @vikvance: Some people actually have marginal tax rates higher than 15%, so if they withdraw their super early, they are getting a tax advantage. If it is done dishonestly, how is it any different to someone falsely declaring their income to pay less income tax? Or is that also not “tax fraud”?

        • Donaldhump on 06/05/2020 - 09:25

          downvoted by some who has nfi about taxation in superannuation

    • Cave Fire on 06/05/2020 - 00:20

      One of the criteria is unemployed. So as long as you are jobless then it's fine. eg, you don't have to lose your job to Covid specifically.

    • crosswire on 06/05/2020 - 07:29
      +1

      https://www.msn.com/en-au/money/personalfinance/tax-office-v…

      "The ATO warned it will review applications carefully and those who are caught fraudulently accessing their super could be slapped with up to $12,500 in penalties."

      Your mate may have just shot himself in the foot. And that goes for anyone else fraudulently withdrawing their super. Harsh penalties for accessing your own money!

      • StonedWizard on 06/05/2020 - 13:41

        Another way to look at it, is you’re still up $8k after paying a penalty.

    • KathySouthMorang on 06/05/2020 - 08:07

      I wish I was able to access my super. My income has not gone down. I have no doubt those that have accessed their super who are not in the legit categories will need to pay fines and tax on monies taken. The Federal Government has to claw back money somehow. There is a lot of rorting going on at the moment. I wouldn't mind an additional 20k in my pocket tax free. But not prepared to do the wrong thing.

      • [Deactivated] on 06/05/2020 - 12:17

        It is not tax-free.

        You get taxed under the superannuation rules.

        • Pantagonist on 06/05/2020 - 13:07

          You get taxed have already been taxed under the superannuation rules.

          FTFY.

          When you withdraw under the early release scheme, you pay no additional tax and are not required to include those amounts on your tax return. In other words, saying that it's "20k in your pocket tax free" is accurate if you don't view superannuation as a form of compulsory wage theft / government oppression.

          • [Deactivated] on 06/05/2020 - 13:40

            @Pantagonist: Past present tense. A bit like Schrodinger's Super Fund.

            • Pantagonist on 06/05/2020 - 13:50

              @[Deactivated]: Point being that the fact that the withdrawal is tax free is different from the usual rules around early access if you're younger than your preservation age.

              Also, for most people, getting taxed 15% on super contributions is better than being taxed at the rate that they would be if they received the money through their salary.

    • [Deactivated] on 06/05/2020 - 09:26
      +1

      I believe nothing will happen, no crack down or anything. People still do cash jobs. still enter false expenditures etc no one gets caught.

      • FutureTech on 06/05/2020 - 13:08
        +1

        Lol as a tax advisor this makes me chuckle.

        Literally tens of thousands of people getting caught every year

    • Fredfloresjr on 06/05/2020 - 09:40
      +4

      Wow people really concern about this. It's their money let them do what they want.

    • lltravel on 06/05/2020 - 11:59

      who cares its his money? why are your panties in a twist? I wish ppl would just mind their own business

    • [Deactivated] on 06/05/2020 - 12:33

      Some very confusing morality here.

      Taking out Super, potentially earlier than entitled, is wrong. Ie. Withdrawing one's own forced savings is bad (and also confused with tax evasions amongst other bizarre ideas.)

      Pensions, drawing money that has been contributed by taxpayers, other people, seems to be above reproach… unless they belong to the group of people who want their own money earlier.

      • Pantagonist on 06/05/2020 - 13:12

        I'm struggling to find an example of someone who has asserted both views. Different people saying those things does not confusing morality make.

        • [Deactivated] on 06/05/2020 - 13:38

          They do not assert both. The assert the first and imply the second. The implication, however, does not leave much ambiguity.

          • Pantagonist on 06/05/2020 - 13:43

            @[Deactivated]: The evidence I'm seeing is that people who have concerns about early super withdrawal follow up that point with comments about those people being an additional burden on the pension / taxation system in the future; in other words, the opposite to what you've claimed?

            • [Deactivated] on 06/05/2020 - 13:48

              @Pantagonist: What you say is true but reason with me, the ultimate disapproval here either has to lay with withdrawing one's own money early or it has to be with welfare burden.

              But we know it isn't the welfare burden people have a problem with as they are not protesting welfare, they are implying the withdrawal of the super is the problem demonstrated by the numerous calls to dob in.

              • Pantagonist on 06/05/2020 - 13:59

                @[Deactivated]: It's almost as if we live in a society which is governed by taxation / welfare rules that are supposed to apply to everyone and there's a public perception that people should abide by those rules.

                To me the outrage seems equivalent to that which arises when someone is found to be obtaining welfare benefits that they're not entitled to, while concurrently the idea of welfare support for those who need it is still broadly accepted.

                • [Deactivated] on 06/05/2020 - 15:09

                  @Pantagonist: But these people aren't scamming welfare.

                  The scenario being discussed, withdrawing super early, is akin to failing earlier and doing so with one own's resources.

                  Morality aside, I do not for a moment believe that someone who will burn through their Super from early release won't end up needing support if they were to withdraw their Super at 65. No one gets wiser just by being older. In fact, someone blowing $20k today may realise their folly and have time to make practical changes.

                  • Pantagonist on 06/05/2020 - 15:44

                    @[Deactivated]:

                    The scenario being discussed, withdrawing super early, is akin to failing earlier and doing so with one own's resources.

                    Not really, especially if you falsely claim to need it under the requirements and then continue to earn money at the same level (which is the scenario that was actually being discussed by the OP before the topic was merged). There are legal loopholes already and if you're prepared to fudge your financials then there are additional benefits on top of these loopholes if you want to play fast and loose with the rules.

                    Morality aside, I do not for a moment believe that someone who will burn through their Super from early release won't end up needing support if they were to withdraw their Super at 65.

                    Although they might still have to access the pension, the idea is that they will be self-funded for longer if they don't touch their super. This concept appears to be working as intended.

                    Regardless, accessing the pension is also not "scamming welfare" if you're entitled to it under the rules and associated income tests. It's no different to any other welfare entitlement or tax concession under the current laws. If someone is legally entitled to it then I have no problem with them accessing it, because those same rules are likely to apply to me when I reach my prescribed retirement / pension age.

                    • [Deactivated] on 06/05/2020 - 18:10

                      @Pantagonist: Well, if all you're taking in consideration are rules then there is no dispute here. Withdrawing early for no reason is against the rules.

    • Herbse on 06/05/2020 - 13:38
      -3

      Report him. For his own sake.
      Sure it's his own money, but the less he has, the more he will rely on government assistance when he eventually retires.

      If he's doing this now when he doesn't need to, it's most likely to pay for luxury items and not necessity. Which means he's going to be one of the elderly who relies heavily on the pension in the future. Hope he enjoys living on the edge of poverty during his golden years.

      Plus he's doing a stupid thing and withdrawing from his super balance when the value is anywhere from 25 to 40% reduced worth. It's like an investor selling shares just after a huge loss. Very, very poor move by someone who you say doesn't qualify and need it.

    • herecomestheoost on 06/05/2020 - 14:18

      The ATO is too busy investigating the Job Seeker / Job Seeker scammers.. People withdrawing their own money is surely not a priority.. Your friend (and myself) are merely bending the rules a little.

      • xuqi on 07/05/2020 - 12:40

        And you'll be bent over in due-course by the ATO. :P

    • cheng2008 on 06/05/2020 - 14:31

      Has anyone who said that this guy will cause extra pension payments to be made actually calculated how much extra pension, if any, will have to be paid out when he retires? My back of the napkin maths says that the payments, if they even have to be made, are minimal, but it would be good for someone in the pension rort camp to clarify.

    • Herbse on 06/05/2020 - 14:34

      The fact that so many users here are supporting the "friend", it looks like many people are dipping into their future. Hope that works out for you 🤞

      • cheng2008 on 06/05/2020 - 14:40

        I am not supporting fraud, however IMO this fraud is due to extraordinary circumstances, therefore not something that is repeatable eg cash in hand. So I don't think the outcry is proportionate.

        Disclaimer: I am eligible to withdraw since my work hours have been reduced, and I have not withdrawn yet but considering doing so.

      • Pantagonist on 06/05/2020 - 15:56

        I'm not eligible to access the scheme and don't intend to.

        I'm also capable of considering that someone withdrawing from super might do something with it other than splash out on luxury items and never replenish the amount withdrawn over the next few years while the economy is circling the bowl and superannuation isn't paying dividends.

  • cookie2 on 06/05/2020 - 15:02
    Merged from Withdrawing Super Early - informal but personal advice appreciated

    Hi all,
    I've been reading various forum posts on OB and outside of OB and I'm a little lost as seems the withdrawing of super funds early is possibly good for some and not for others (or atleast there are various opinions on the matter).

    My circumstances are as follows-

    mid 30s, my partner and I not working as returned from OS to casual roles in retail in the middle of COVID -19 without shifts.
    I am trying to find work in an office or home environment instead as due to both personal and family circumstances I need to keep any risk of contracting COVID down as much as possible. (obviously coming back from overseas, we had no idea the bad timing to not have secure roles)!

    we rent, have a little money in savings but not quite enough to get a home loan.

    I'm pondering on the idea of releasing some super and putting straight into savings, to then have enough for a home loan once we are both gainfully employeed again. Possibly making additional super contributions for the next 2 years to re fill the amount removed (I assume this helps mitigate losses over time but correct me if I'm wrong)

    Any advice or direction would be appreciated. :)

    • roby21 on 06/05/2020 - 15:07

      So, I'm not financial expert, but I guess it'd depend on how much is in your Super already and if the long term projection of that is as valuable as being able to purchase your own home (for the long term? or at least starting somewhere and then selling and upgrading as you get older)

      Coincidentally, a colleague showed me this today which you may be eligible for: https://www.commbank.com.au/home-loans/first-home-loan-depos…

      • cookie2 on 06/05/2020 - 17:17

        thankyou for this. I have heard of a few schemes available and do have enough to be able to contribute the percentage required. Ii just feel like having a large chunk to begin with is "safer".Ii've never felt comfortable with the idea of a large debt over my head. But that's an issue I probably need to get over. I've saved the link you sent and I'm going to look into this further.

    • tsunamisurfer on 06/05/2020 - 15:14
      +1

      Don't worry about eligibility for a mortgage in the future.

      The #1 priority is being about having a roof and food for the next 6 months.

      Can your savings last this long? The virus restrictions may be lifting but it will take a while for the jobs to return.

      Don't worry about paying the Super back once you get settled if your next goal is home ownership, build up your deposit, then buy then look to build Super, you are still young.

      • Fredfloresjr on 06/05/2020 - 15:21

        I second this. Go get your super. Remember YOLO. People will tell you not to. Imagine waiting for the retirement and just getting sick and ended up in aged care. Used it now when you can. Enjoy.

        • cookie2 on 06/05/2020 - 17:20

          yeah, fine with savings I think, I'm pretty frugal anyway so no real concern there. yeah I tend to agree with you in regards to YOLO just wasnt sure if it's a stupid idea if I dont need it for immediate expenses. I tend to live YOLO a lot of the time (hence going casual and traveling) thanks for your advice.

    • Trying2SaveABuck on 06/05/2020 - 15:15

      Im not financial expert do everyone situation is different so dont take this as gospel,

      It really depends on your current expenses and when to expect to be back in the job?

      If the personal sacrifices are too great this could be from not more eating take away every night to keeping the lights and a roof over your head (though you cant be evicted) then perhaps you need to take some money out of your Super

      Generally though taking money out of your super right now isnt a 'good financial decision' as you would be doing what investors call selling during a low - Your super is mostly made of Shares domestic and overseas and right now most if not all markets are at 3-4 year lows this is normally the time a adviser would tell you too buy shares or at least stick to your guns.

      • cookie2 on 06/05/2020 - 17:24
        +1

        I understand the concept of selling while low but thought maybe if I'm using it to invest in the future and purchase a place to live, with house prices constantly increasing at a crazy rate, maybe it's beneficial for me. Current expenses are low (besides rent) but I'm ok. It helps being anti social and enjoying cooking my own foods :)

    • ssquid on 06/05/2020 - 15:16

      If you can't save a deposit you shouldn't be getting a home loan.

      • cookie2 on 06/05/2020 - 17:12

        massive generalisation. If I saved enough to get a home loan and then lived in said home of my own, I wouldnt be forking out the rest of my monies into renting the roof over my head. Everyone has different circumstances and complications, these things dont always mean it's a no, just that you might need to make sacrifices- smaller loan, smaller property etc. but I appreciate your positive contribution into my question about withdrawing super, not about whether or not I should get a home loan.

      • whitelie on 06/05/2020 - 17:38
        +2

        My weekly rent is higher than the equivalent mortgage repayment would be. The "trouble" with saving a deposit is that to do it in a reasonable time frame, you need to effectively take double the repayment out of your pay packet. If you can't do it in a shortish time frame, usually the bar keeps getting higher as prices rise.

        • ssquid on 06/05/2020 - 19:00

          Owning a home isn't just about paying a mortgage. There's also rates, insurance, full water bills (not just usage), ongoing maintenance…

  • LFO on 07/05/2020 - 19:11
    +1

    For those horrified or at least concern about taking their own Super, justifiably or not:

    Money will be spend locally, reactivating the economy

    The proverbial SHOT IN THE ARM

    It is all good and very positive!!

    • IanC on 21/05/2020 - 14:17

      Agree . In some cases will be spent very locally at the nearest TAB.

      Case noted of $10000 take out Thursday and gambled away by Monday.

      Really helps the local community.

      • LFO on 22/05/2020 - 19:32

        Well, if that is what you did then that is what you did.

        It would have been gambled as well when you retire.
        So it is the same, really. Now or later, the same.
        With the benefit of, if winning, you are now younger to enjoy the big win for longer.

        Now a LOT of others will use the money "differently".
        Paying debt, buying better clothes, getting dentistry done, children shoes … the list is never ending.

        PS: Did you win anything of the $10K?

        • IanC on 25/05/2020 - 11:01

          Referring to a report in the AFR.

          • LFO on 25/05/2020 - 17:15

            @IanC: OK, sorry.
            Misunderstood and retracted.

            Please remove the "you" references.
            And change to they / them.

            By the way, aren't the TABs closed because of the COVID lockdown?
            Fake news from AFR?

            • IanC on 27/05/2020 - 16:05

              @LFO: no problem

  • [Deactivated] on 10/05/2020 - 00:16

    Just wondering if I am eligible in the below scenario.
    Main source of income has been cut by 20% for one month so far, may turn in to 2 or more months TBC - Employer to advise.
    Secondary source of income is growing amply to cover the loss of the 20% income from the main source.
    Could I claim the $20k from my super legitimately?
    Plan would be to invest the $20k into my second source of income, given the positive ROI it is delivering and spread my risk should my main source go south.

  • Chubbsmcfatflabs on 15/05/2020 - 18:50

    I took out some super as I am not working at the minute. Will be going back to the well again in 1 July if I haven't picked up another engagement by then. The amount we can access is less than 5% of whats in my super and also when I get back to work with the law required contributions, It'll only take a few months to reconstitute the balance to pre covid levels.

    Rather spend money that I would never thought I would have access to rather than spend my actual savings. Its a bonus for me.

    Always thought that I would never see it and have run my personal finances with this in mind. ie Property and other investments for retirement. So I was really pleased I got this little bit extra.

  • Mentallysick on 26/05/2020 - 10:27
    +2

    Can i contribute 10K now to my super fund and claim it as concessional so i get tax deduction on $10K when i lodge my tax return for 2020. & Also Apply for 10K early access to my super this year and put it back on my mortgage. I am eligible for early access to my super but can still survive without taking it out but want to go for it if it can save me my $$. Please let me know if my idea is good and i can save money $3,250.00( 10K*32.5%)

    I will put that 10K received from super back to my offset account.

    Is this one of the tax loophole?

    • bluesky on 26/05/2020 - 17:25
      +1

      I think it is a bad idea if your purpose is to avoid tax because ATO is getting funds to report integrity issues.

      Contacting the ATO
      We have set up a contact for funds to raise integrity and fraud concerns or intelligence directly with a specialised team. The contact is [email protected].

      Contributing and withdrawing within such a short period of time is such an easy thing for the fund to spot. This could speak to whether you are "financially affected by COVID-19". Even if ATO cannot prove your intent, it could raise a red flag, and you could be queried. Even if no action is taken from it, perhaps it might flag you into the future, causing higher scrutiny of your tax returns, or making things harder when you really need early super release one day.

      ATO also covered for scenarios where they need to pursue individuals:

      Fraud
      Individuals will be warned during the application process about the penalties that apply to them if making a false and misleading statement.
      Any particular cases of concern will be managed by us with the individual.
      Warnings about making false or misleading statements will be part of the application process and the individual will make declarations

      The government splashed out so much for stimulus, they will have to find ways to increase tax intake, this area (or fraudulent Jobkeeper) could be the first port of call. Much easier than increasing taxes. Besides, govt may have to hire more people to help with unemployment. If in ATO, what better area to put them to work in? This is just my thinking.

    • Cheap Steve on 29/05/2020 - 23:21
      +2

      Ignore the chicken littles. Yes, your strategy is legal, solid and smart. Go for it.

      • SheepshearingReyrey on 05/06/2020 - 14:27

        How do you know?… i'm one of the chicken littles and it's killing me!!!

        i shoulda contributed much earlier this year.

    • [Deactivated] on 02/06/2020 - 11:10
      +1

      How did you get to the figure of saving $3,250? That sounds wrong.

      • Mentallysick on 03/06/2020 - 09:39

        i am on a tax bracket of 32.5%. I can deduct $10K if i contribute it to super as concessional contribution. So will reduce my tax by $10K*32.5% = $3,250.00

        • Mentallysick on 03/06/2020 - 10:59
          +2

          Edit: Yeah will reduce my tax by $3,250 but will be taxed @ superfund at 15% which is equivalent to $1500. Hence, a saving of $1,750 per FY.
          2 X $1,750 = $$3,500 savings all up for 2 FY.

          Thank you

    • djprima on 25/06/2020 - 17:11

      This article is posted further down in the comments, you might want to check it

  • LemonShapedRock on 02/06/2020 - 09:23
    +1

    Does anyone know whether taking leave counts as reducing your working hours by 20% ?

    The wording is "your working hours were reduced by 20% or more"

    I spoke with the ATO and they couldn't give me an answer, only advised that it's a self assessment and to make your own judgement.

    In their words "we haven't been told whether we will be auditing these applications", the frontline staff seem to be in the dark with some of this stuff.

    • AncientWisdom on 03/06/2020 - 13:45

      Is the leave permanent? If not, what happens when you go back to work with your working hours?

      • LemonShapedRock on 03/06/2020 - 15:16

        In the scenario I'm thinking, it would be a temporary leave arrangement returning back to normal working hours

        • AncientWisdom on 04/06/2020 - 12:56

          Assuming you mean leave without pay, I guess it would depend on the length of leave. Perhaps if more than 1-2 months than in my opinion that would still count, but it's just my opinion.
          You'll have to decide what you think is right and be ready to explain it to the ATO if asked.

  • Ralphtheguy on 05/06/2020 - 17:43

    I have contributed roughly 10k to my super in 2018 for the FHSS grant, I have roughly 90k in super but that would have taken a hit. I am thinking of doing this and getting the 20k to then have enough for a deposit of about 30k. My hours have been cut but I think this is a once in a lifetime opportunity to have enough for a deposit finally. Surely having a house outweighs the super I can access when I am 65. Thoughts?

  • StonedWizard on 09/06/2020 - 22:41

    I work full-time, but also work casually at another place randomly. If the place I'm a Casual, can't offer me shifts does that qualify me?

    I'd use the money to help pay off my mortgage.

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