A re-contribution strategy involves the withdrawal of a lump sum from your superannuation which you then re-contribute back.
By Ian George - Principal
Good news for self-funded retirees with the Government’s announcement of an extension of drawdown relief for account-based pensions for the 2012-13 financial year.
Contrary to earlier plans to return minimum payment amounts to normal in 2012-13, self-funded retirees will now benefit from a continuing 25% reduction in the minimum payment amounts. The provision of drawdown relief for the past four years has reduced the need for account-based pension holders to sell assets at a loss in order to meet the minimum payment requirement.
Minimum payment amounts for account-based pensions were halved for the 2008-09, 2009-10 and 2010-11 financial years. This relief was cut back to a 25% reduction for 2011-12. With continuing volatility in equity markets extending the current limited drawdown relief for a further year will assist retirees to recoup capital losses on their pension portfolios as equity markets recover over time.
Should you wish to discuss these announcements or have other self managed super fund questions, please give me or our financial advisers a call.