Concessional Contributions Cap Changes

Legislation to implement the Government’s Budget Decision to reduce the concessional contributions cap from $50,000 to $25,000 has been introduced.  The legislation will also introduce the reduction in the transitional concessional contributions cap from $100,000 to $50,000.

These changes apply from 1 July 2009 and so will affect 2009/10 and subsequent financial years.

Indexation of the concessional contributions cap will apply from 1 July 2010 and the cap will be adjusted in increments of $5,000.  The transitional concessional contributions cap is not indexed.

The relevant bill is Tax Laws Amendment (2009 Budget Measures No 1) Bill 2009.