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Self Managed Super Fund (SMSF) Article
The New Super Contribution & Preservation Rules

By Tony Negline.

This article may be out of date.

22nd August 2007

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Being able to make contributions into the super system or get money out of it is very important knowledge.

Currently there are five basic rules that allow superannuation contributions:

This is a really difficult definition to grapple with at the best of times.  It is common for people to ask if working for a charity for little or no reward is okay.  Some want to know if looking after the grandchildren for cash wages is acceptable.  We have never had guidance from the government regulators as to what is or is not acceptable.

These aren’t the only rules involving super contributions – there are also rules about when the Government’s Co-contribution can be made.

There are also a set of rules for splitting super contributions.  One new rule which applies after 5 April 2007 says that only contributions claimed as a tax deduction can be split between spouses.  Under the old rules it was possible to split personal undeducted contributions.

Finally it is important to remember that if you wish to claim a tax deductionyou’re your personal contributions to super, you need to send the fund some paper-work (called a Sec 290-170 Notice) and the fund must send you another notice acknowledging this first information.  The paper-work the fund sends you must be kept in your tax records.  You aren’t allowed to claim the deduction until you have the information from the fund.

Once the contributions have been made the trick is to get the money out (assuming that you want to get it out).

There are nine different way to get money out of the super system.  Collectively these are called Conditions of Release:

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This email is general in nature only and does not constitute or convey specific or professional advice. Legislation changes may occur quickly. Formal advice should be sought before acting in any of the areas discussed. Be aware that the information in these articles may become innaccurate with time. Responsibility is disclaimed for any inaccuracies, errors or omissions. Particular investments are neither invited nor recommended and hence this publication is not "financial product advice" as defined in Section 766B of the above legislation. All expressions of opinion by contributors are published on the basis that they are not to be regarded as expressing the official opinion of any other person or entity unless expressly stated. No responsibility for the accuracy of the opinions or information contained in the contributor's articles is accepted by any other person or entity. Copyright: This publication is copyright. If you wish to reproduce this article you require a license, which can be purchased here, to do so.

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