Overview
From 1 July 2023, the general transfer balance cap is expected to be indexed to $1.9 million. The personal transfer balance cap for individuals will vary and is dependant upon their circumstances, ranging from $1.6 million and $1.9 million.
For further information regarding the indexation, visit the Transfer balance cap indexation article released by the ATO.
In line with the Transfer Balance Cap indexation of 1.9mil on 01/07/2023, the Total Superannuation Balance threshold has been changed in calculating the 3-year Non-Concessional Contribution Bring Forward Cap.
These changes have now been reflected in the Simple Fund 360.
You will be able to manage and view these caps through the Contribution Dashboard and Contribution Breakdown Report.
What would members be able to contribute?
From 01/07/2023, to access the bring forward rule, the individual must be below the age of 75 years at any time in a financial year.
Legislation changes for the 2022 FY
Note that due to legislation changes, from 01/07/2022 individuals below the age of 75 will have access to the bring forward rule. For more information, see the ATO article on Non-concessional contributions.
The following is a breakdown of what a member is able to Contribute as non-concessional contributions from 01/07/2023 relative to their Total Super Balance.
|
Total Superannuation Balance
|
Contribution and bring forward available
|
|
$1,900,000 or over
|
$NIL
|
|
$1,790,000 to $1,900,000
|
$110,000 (no bring forward available)
|
|
$1,590,000 to $1,790,000
|
$220,000 (available over 2 years)
|
|
Less than $1,590,000
|
$330,000 (available over 3 years)
|
If an individual has triggered a bring forward arrangement before 1 July 2023, they will not have access to any additional cap space as a result of the increase to the non-concessional cap.
The Indexation in Simple Fund 360
The new Indexation cap limit entry will be posted in the TBAR dashboard in the 2023-2024 Financial Year. The entry will be recorded once the close period is performed for the 2023-2024 financial year from the Period Compliance screen.
The TBAR entry will appear as below
For the funds that have not performed 'Close Period' that have been set up in the 2023 financial year or migrated funds will need to use the ‘Calculate Personal TBC’ button in the TBAR dashboard to trigger the indexation cap limit entry.
In the event of the current system calculated cap limit does not agree with ATO provided personal cap limit, users can manually update the cap limit by selecting Edit and editing the indexation entry.
'Calculate Personal TBC' button
From the 2022 Financial year onwards, a Calculate Personal TBC button will appear in the Transfer Balance Dashboard. Clicking this button will re-run the Close Period TBAR Cap Indexation Calculation.
There are potentially 4 scenarios that would require you to use this function:
- Migrated fund from SF desktop: Given that Simple Fund Desktop will not have the indexation logic implemented, this will look at each members TBAR history and run the indexation calculation.
- Where you have edited (manually adjusted) the cap indexation entry incorrectly and want to reinstate the system calculation
- The fund has been finalised and lodged for 2021FY and you need missed an TBAR entry in a prior year, where you do not want to reopen the prior period(s).
- You have received a new client in the 2022FY
Please note that while these scenarios are directly related to the indexation that occurred on 01/07/2021, you may need to use the 'Calculate Personal TBC' button in the 2024FY for the indexation occurring on 01/07/2023.