Common Sense Prevails in Super Tax Revisions

News out of Canberra -  the Federal Treasurer has announced several significant amendments to the proposed tax on superannuation balances over $3 million.

In what many are calling a common-sense adjustment, the government has confirmed:

• The start date for the tax will be delayed by 12 months, now commencing 1 July 2026, with the first tax bills due after the conclusion of the 2026/27 financial year.
  
• The $3 million threshold will now be indexed to CPI, ensuring it keeps pace with inflation.
  
• Most importantly, unrealised capital gains will be excluded from the tax calculation, a move welcomed by financial and farming sectors alike. While details on the revised calculation method are yet to be released, the exclusion of unrealised gains marks a significant win for fairness and practicality.
  

To balance the reduced revenue from these changes, the government has introduced an additional $10 million superannuation balance threshold, with balances above this level to be taxed at 40%, compared to 30% for balances between $3 million and $10 million. This new threshold will also be indexed to inflation.

Draft legislation is expected in 2026, and we will continue to monitor developments closely and keep you updated as further details emerge.

With around eight months before the start of the 2026/27 financial year, there is time for individuals and trustees to review their superannuation and determine the best approach moving forward.

If you’d like to discuss how these proposed changes could impact your personal or business situation, please reach out to your Forsyths team.