Eligibility for pension will be put to the test
YOUR ADVICE
QMY husband is 63, has no plans on retiring, earns $75,000 a year and has $200,000 in super. I am 50, earn $45,000 and have $120,000 in super.
Our house is paid off and I have another house on which I owe $350,000, which is not rented.
Will this affect my partner’s ability to get a part pension and when would he be entitled to one?
When your husband’s eligibility for a pension is being considered, assets owned by either of you will be assessed by Centrelink.
The gross value of your investment property less the loan will be the assets test value, and the income as shown on your tax return will be the income test value.
Your superannuation will not count until you reach pensionable age.
He will be entitled to a pension if he qualifies under the assets and income tests when he reaches pensionable age, which will be 66 for a person born between January 1, 1954 and June 30, 1955.
AQI’M 23 years old and would like to buy a house within the next three years.
I have $45,000 in savings ($38,000 of this is in shares). My income before tax is $75,000. My employer’s super contribution is 17 per cent on top of this, and I salary sacrifice 5 per cent to super each fortnight (current super balance is $20,000).
I’m interested in the First Home Super Savers Scheme. Is it worth raising the amount I salary sacrifice so that my deposit savings are taxed at a lower rate?
If not, where should I be placing my savings until I have enough for a deposit?
There is a small advantage to you in using the new scheme.
You are currently voluntarily salary sacrificing $3750 a year, so it should be possible for you to cancel this and direct a total of $15,000 to the new scheme, made up of an additional contribution of $11,250 and your existing contribution of $3750.
The contributions tax on this would be 15 per cent, or $2250,
Aleaving a net amount of $12,750 in the special home deposit account within superannuation.
Earnings would be credited at a notional rate of 4.78 per cent. If you contributed a gross $30,000 in two years you should have around $25,500 in the special superannuation account, with the earnings being taxed at 15 per cent instead of your marginal rate.
Let’s assume you end up with $26,500 including earnings. When this was withdrawn it would be taxed at $1325 (your marginal rate of 35 per cent less a 30 per cent rebate) giving you a net $25,175. Just bear in mind that it is highly likely the money could be withdrawn only for a house deposit, so it could be inaccessible for a long time if you delay buying a house.
Noel Whittaker is the author of
and other finance books. His advice is general in nature and readers should seek their own professional advice before making any financial decisions. Email: noel@noelwhittaker.com.au