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Author: Sylvia Veale

Family Trust Tax: The May Rule Changes, just changed again – What the New Election Option Means

Posted on by Sylvia Veale

Where This Started

Back in May, Treasurer Jim Chalmers announced a 30% minimum tax on discretionary trust distributions, to commence 1 July 2028 with no grandfathering. The stated goal was to align trust income with the tax rates paid by ordinary workers targeting the practice of streaming trust profits to family members on lower marginal rates, or to “bucket companies,” each year depending on who benefited most.

A three-year CGT-free rollover window (1 July 2027 to 30 June 2030) was offered for families wanting to restructure out of a discretionary trust altogether. That relief, though, did not address state stamp duty, and under the original design, a bucket company receiving a trust distribution did not receive a credit for tax already paid at trust level creating a genuine double-taxation trap.

What Changed Overnight

Following sustained pushback from small business groups particularly the Council of Small Business Organisations Australia (COSBOA), the Mortgage & Finance Association of Australia, and the Commercial & Asset Finance Brokers Association Treasury released exposure draft legislation on 3 September 2026 that materially softens the original proposal. Consultation on this draft, closes 18 September 2026.

The core addition is a new election option. From 2028–29, trustees will face a genuine choice:

Option A – Stay In The Minimum Tax Regime (The Original Design)

The trust pays 30% tax at trustee level. Individual beneficiaries get a non-refundable 30% tax credit against their distribution. Bucket companies get no such credit, so income directed through a company can face an effective rate in the order of 63–70% before it reaches a shareholder as a dividend.

Option B – Elect Fixed Distributions (The New Alternative)

The trustee makes a one-off, largely irrevocable nomination of beneficiaries and their fixed share of income (and capital). In exchange, the trust bypasses the 30% trustee-level tax altogether. Individuals are taxed at their own marginal rates as usual, and a nominated bucket company is taxed once, at the standard 25–30% corporate rate provided that company has no discretionary share structure (share classes).

The trade-off: electing Option B means genuinely giving up the year-to-year flexibility that makes a discretionary trust discretionary. It appears that once the nomination is made, the election can only be revoked as a result of death or divorce. If distributions are varied outside the nominated fixed split, or anunauthorised beneficiary is paid, the election is automatically revoked. The trust is taxed at the top marginal rate plus Medicare levy (47%) for that year, and is permanently locked into Option A afterwards.

Other design points carried over from the original proposal:

  • Fixed trusts, widely held managed investment trusts, bare trusts, complying super funds (including SMSFs), and special disability trusts remain outside the regime entirely.
  • Primary production income and income for vulnerable minors remain exempt from the minimum tax.
  • Genuine testamentary trusts funded before budget night (12 May 2026) remain exempt.
  • Any discretionary trust established after 1 July 2028 will never be eligible to make the election.

What’s Still Unresolved

Industry reaction has been cautiously positive but not uncritical. COSBOA has welcomed the election as a genuine improvement while maintaining that the broader policy design remains flawed, and has specifically flagged the permanent lock-out penalty as excessive: “This is unnecessarily punitive and does not reflect the realities of family businesses.”

There are also open questions the draft doesn’t yet answer clearly most notably what happens to a beneficiary born or added to a family after an election is locked in, since the nomination list generally can’t be expanded except on death or a relationship breakdown.

Adapting The Restructuring Conversation

For clients currently modelling their options, this changes the shape of the conversation materially:

  • The election is now the default question to ask first, ahead of any full restructure. For businesses and families confident they can commit to a fixed distribution pattern indefinitely, Option B avoids both the 30% trustee tax and the stamp duty exposure that would come with restructuring into a company or fixed trust.
  • Bucket company strategies remain viable, but only in “clean” form. Any bucket company relied on for the election must have a single class of shares existing structures using dividend streaming or differing share classes to vary payouts between family shareholders would need to be simplified before they could be nominated.
  • The permanence of the election is the real decision point, not just the tax rate. Families with growing or changing beneficiary groups (new grandchildren, evolving business partners) need to weigh the tax saving against locking in today’s family structure indefinitely.
  • Restructuring into a company or fixed trust remains the fallback for families who value ongoing flexibility over the fixed-distribution tax saving, using the existing 2027–2030 CGT rollover window accepting that stamp duty relief from the states is still not confirmed.

Bottom Line For Clients

This remains draft legislation, not law and consultation closes 18 September 2026 and further tranches (including rules on unpaid present entitlements) are still to come. The formal election, once legislated, won’t need to be made until between 1 July 2028 and 30 June 2029. There’s no need to commit to anything now, but every family currently sitting in a discretionary trust should understand that a genuine third option beyond “pay the tax” or “restructure” is now on the table, and start thinking about whether their trust could realistically operate under a fixed distribution pattern.

*This article contains purely factual information and/or general advice and does not constitute personal financial product advice.  The content of this article does not take into account your personal objectives, financial situation or needs and you must determine whether it is appropriate to your situation.  We recommend you obtain financial, legal and taxation advice before making any financial investment decision.

About the Author:

Matthew McCarney – Executive Director & Private Client Adviser – Vantage Wealth Management

Matthew is an Executive Director of both Vantage Wealth Management Pty Ltd and VWM Financial Services Pty Ltd.

Matt holds a Bachelor of Commerce from the University of Wollongong with majors in Industrial Relations and Management Studies. Matt has also attained a Graduate Diploma in Financial Planning from the Financial Services Institute of Australasia (FINSIA). Matt is a Fellow of FINSIA and also a member of the Financial Advice Association Australia (FAAA). Matt commenced working in the financial services industry in 1996. He has worked for two of Australia’s leading fund managers, BT Funds Management and Colonial First State. Since 2003 Matt has specialised in providing quality strategic and investment advice to his clients.

Matt is passionate about making a meaningful difference in each of his client’s financial lives. Matt co-founded Vantage Wealth Management in 2008. He has served on the Board of The Dyslexia SPELD Found WA (Inc.) since 2013.

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The AI Investment Boom: Where Your Portfolio Is Positioned

Posted on by Sylvia Veale

Artificial intelligence has evolved over recent years to now be the largest driver of capital spending in global equity markets. This paper explains what artificial intelligence is and how it works, examines the unprecedented scale of investment now taking place, and outlines how Vantage portfolios are positioned for the impact AI will have.

What Is Artificial Intelligence?

An artificial intelligence model is a computer program that has been shown enormous volumes of data including text, images and code, and has learned the patterns within that data well enough to produce new work of its own. Ask it a question and it assembles a response one word at a time, choosing at each step the continuation that best fits everything it has learnt. Over time, these models have continuously improved as more data and computing power have increased.

Although the term artificial intelligence was invented by computer scientists back in the 1950s, it was not until OpenAI released ChatGPT to the public in November 2022 that the technology became widely recognised. ChatGPT reached an estimated 100 million users inside two months, faster than any consumer product before it. Since then, many different artificial intelligence models have been released; Gemini, Grok, Bard, including Anthropic’s Claude, naming but a few, with every generation materially more capable than the one before it, and improvements are growing daily.

The Capital Being Invested

Running these models requires a physical infrastructure buildout on a scale the world has rarely seen before. The closest comparisons are the railways of the nineteenth century, the electrification of cities in the 1920s and the fibre-optic boom around 2000. Combined capital expenditure across the five largest U.S. operators of data centres, being Amazon, Meta, Alphabet, Microsoft and Oracle, has risen from around US$160 billion in 2022 to a forecast approaching US$1 trillion a year by 2030.

It helps to picture the industry in layers. At the base sit electricity and raw materials, principally copper for wiring and grid expansion, and gas, oil, uranium and renewables for generation. Above that sit the components: processors, memory, cooling systems and electrical equipment. Above those sit the data centres themselves. The research laboratories such as OpenAI and Anthropic rent capacity from those data centres, and at the top sit the businesses we as consumers use and see every day; building products and delivering services using the models.

Source: LSEG Datastream, Resonant Asset Management. Combined capital expenditure, five largest US data centre operators.

Hyperscalers are the U.S. tech giants (Amazon, Meta, Alphabet, Microsoft and Oracle) that own and run the world’s largest data centres. Hyperscaler; a typically eye catching piece of financial jargon, that labels businesses having built an application or service that can experience significant growth in users with only very marginal increase in operational costs. They have no shortage of cash to spend, with the real constraint being the supply chain. The Hyperscalers, however, are competing for scarce electricity, computer memory, advanced chip packaging from TSMC in Taiwan and the most advanced processors from Nvidia. If those shortages eased, the spending would be higher.

Source: LSEG Datastream, Resonant Asset Management. Combined free cash flow, five largest US data centre operators.

We have been monitoring the free cash flow (the cash they have left after paying to run and grow the business) of the big U.S. technology companies, which analysts expect to fall by about 90% between 2024 and 2027 as these companies spend more on AI construction. Can the ‘hyperscalers’ get to a point of sustained, growing profit margins given their upfront capital investments? This is the question that only time will tell.  Given the supply chain issues in bedding down their operational frameworks, we have been positioning portfolios away from the U.S. Mega Caps, which are spending a large share of today’s profits for a payoff still many years away.

Where Your Portfolio Is Positioned

Our focus has been on companies in the supply chain that artificial intelligence construction programs depend on, rather than the companies doing the spending. The distinction matters because the suppliers are receiving cash now, while the Hyperscaler companies building the data centres are absorbing the cost of that spending well ahead of any profit return.

  • Australian Equities: Australia supplies a meaningful share of physical commodity inputs required for the artificial intelligence build out. Copper is required for data centre wiring and for the electricity network expansion that must accompany it. Both current portfolio overweights, BHP Group and Rio Tinto, have been sensibly directing capital towards growing their copper divisions.
  • Global Equities: International portfolios have focused on hardware and semiconductor companies, like SanDisk, Samsung Electronics and SK Hynix, that manufacture the processors and memory the data centre build-out depends on. These businesses are being paid in cash now, and have seen strong upward revisions to earnings, reflecting sustained AI-driven capital investment and profit growth. At the same time, we are underweight the largest names in the benchmark, including many in the Magnificent Seven, which are committing a large share of their cash flow to a build-out where the payoff is still many years away.
  • Global Infrastructure: A large data centre uses as much electricity as a small city, running 24/7. Meeting that demand requires new generation, grid and transmission capacity, and the spending flows to the regulated electric utilities and grid operators that own and run this network, who get paid regardless of which AI company ends up winning. Their revenues are set by regulators and backed by long-term contracts, giving steady, predictable cash flows and a lower-risk way to participate in the AI build-out. Our meaningful exposures here are Entergy, NextEra Energy, Pinnacle West and Public Service Enterprise Group.

Conclusion

At Vantage, our investment philosophy is to own quality businesses at sensible valuations, build well-diversified portfolios and invest for the long term rather than chasing short-term thematics. Staying measured in being ahead of the game, rather than chasing yesterday’s winners.  Our aim is to construct portfolios that perform well as rational outcomes emerge, rather than an ‘all-in’ perspective on a single view of a technology being correct.

*This article contains purely factual information and/or general advice and does not constitute personal financial product advice.  The content of this article does not take into account your personal objectives, financial situation or needs and you must determine whether it is appropriate to your situation.  We recommend you obtain financial, legal and taxation advice before making any financial investment decision.

About the Author:

Anthony Nguyen – Head of Investments – Vantage Wealth Management

Anthony commenced his career in the financial services industry in 2018, bringing a strong educational background to his role. He holds a Bachelor of Commerce from the University of Western Australia and a Master of Finance from Curtin University, where he received the Curtin School of Economics and Finance Head of School Prize for graduating at the top of his class. He has also successfully passed the CFA Level 2 exam.

As the Head of Investment at Vantage Wealth Management, Anthony is responsible for overseeing investment due diligence, investment governance and portfolio management of the Vantage Managed Accounts. He is an integral member of both the Vantage Investment Team and the Vantage Investment Committee.

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Generosity Without The Guilt – A Different Take on the Bank of Mum and Dad

Posted on by Sylvia Veale

Every few weeks, another headline declares that older Australians “must” step in to rescue younger generations from a housing market and cost-of-living squeeze that isn’t of their making. The commentary is loud, the politics around it louder, and the implication is rarely subtle: if you’re over 55 and sitting on equity, you owe it to your children to hand some of it over, sooner rather than later.

We think that framing deserves a closer look.

There are genuinely good reasons why a parent might choose to support an adult child financially, and we cover several of them below. But “genuinely good reason” is a different thing to “default expectation,” and in our experience the two have become blurred. Before any transfer of wealth takes place, the starting position in this office is the same one we’d apply to any financial decision: what does this do to the client’s own security, and is it being made freely or under pressure?

The Pressure Is Real and Worth Naming

Much of the current narrative around intergenerational wealth has been shaped by media commentary and, more recently, by federal budget positioning on capital gains tax and family trust structures, pitched explicitly as measures to “rebalance” opportunity toward younger Australians. Whatever the merits of the policy debate, it has had a side effect worth flagging plainly to clients: it has made some older Australians feel they are somehow the problem, and that opening the cheque book is the correction.

That is not a basis for good financial decision-making. A gift or loan made out of guilt, or in response to a headline, is rarely made on sound terms – and it is exactly the kind of decision that tends to unravel later, for the giver as much as the recipient.

Our view is straightforward: political and media noise around generational fairness is not financial advice, and clients are entitled to make decisions about their own capital on their own terms and timeframe, regardless of the mood of the public debate.

What’s Often Left Out of the Conversation

The commentary around the Bank of Mum and Dad tends to focus heavily on the upside a child helped into a home, a grandchild’s school fees covered, a family able to “get ahead.” What it discusses far less often is the downside risk sitting with the person who wrote the cheque:

The Money May Not Come Back When It’s Needed Most.

Aged care is expensive and often arrives with little notice. Capital gifted away in your 60s or early 70s, when it felt comfortable to give, may be capital you need in your 80s and can no longer access.

Relationship Breakdown Can Expose The Gift

Funds provided to a child, particularly toward a home, can become part of a property pool in the event of separation or divorce meaning a parent’s support may ultimately benefit an ex-partner rather than their own child or grandchildren.

Lifestyle Creep Is a Real Cost, Not a Soft One

Support that starts as “help with a deposit” or “help while you’re between jobs” can, without clear boundaries, become an ongoing subsidy of a lifestyle the child could not otherwise sustain – at the direct expense of the parents’ own retirement spending, travel, and discretionary income.

Fairness Between Children Rarely Stays Simple

One-off support to one child, without documentation or a clear estate planning link, is a well-worn source of family conflict down the track.

Parents Are Allowed to Say No – Or “Not Yet”

A message we increasingly give clients directly: you are not obliged to underwrite your adult children’s choices, and forgoing your own retirement comfort so a child can avoid discomfort is not a virtue in itself. There is nothing irresponsible about a client choosing to keep their capital, maintain their own lifestyle, and let their children build financial resilience the way most generations before them did – incrementally, and with some friction along the way.

For many clients, the more durable form of support is not a lump sum today but a well-structured estate plan that transfers wealth at the right time, in the right way, once their own needs – including aged care – are properly provided for.

If You Do Decide to Help, Protect Yourself First

Where a client does want to provide support, our role is to make sure it is done on terms that protect them, not just the recipient. In practice this means:

  • Documenting whether funds are a gift or a loan, with formal loan agreements and, where appropriate, registered security if the amount is significant.
  • Considering a Binding Financial Agreement for the receiving child’s own relationship, particularly where the funds are contributing to a jointly held asset.
  • Building the support into the client’s broader retirement and aged care funding plan, not treating it as a one-off transaction separate from the rest of their affairs.
  • Reviewing the client’s Will and estate plan to reflect the support already given, so other beneficiaries aren’t disadvantaged without the client’s clear intention.
  • Revisiting the arrangement periodically circumstances change, on both sides of the transaction.

Where We Stand

Our role at Vantage Wealth Management is to represent our clients’ interests – not the interests of the broader intergenerational debate, and not the political framing of the moment. For clients considering whether, when and how to support the next generation, that means a clear-eyed conversation about their own retirement security first, followed by a properly documented plan if support is to proceed.

If you are weighing up a request for financial support from family, or want to put appropriate protections around support you’ve already provided, speak with your Vantage Wealth Management adviser before any funds move.

*This article contains purely factual information and/or general advice and does not constitute personal financial product advice.  The content of this article does not take into account your personal objectives, financial situation or needs and you must determine whether it is appropriate to your situation.  We recommend you obtain financial, legal and taxation advice before making any financial investment decision.

About the Author:

Ben Sumner – Private Client Adviser – Vantage Wealth Management

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Could You Now Be Eligible for a Part Age Pension? New Thresholds Are Worth a Second Look

Posted on by Sylvia Veale

If you’re retired or approaching retirement with a meaningful portfolio of shares, managed funds, term deposits or other private investments, changes to two key age pension thresholds from 1 July 2026 may be worth your attention, particularly if you were told in the past that your assets or income put you just outside the pension system altogether.

What’s Changed

The assets test thresholds have increased from 1 July 2026, including both the upper cut-off limits and the asset-free areas that determine when the age pension starts to reduce.

The upper limits, the point at which pension entitlement cuts out completely, have increased as follows:

Assets Test Cut-off: Non-homeowners

  • Single: $1,000,500 (up from $980,000)
  • Couple (combined): $1,369,500 (up from $1,343,000)

Assets Test Cut-off: Homeowners

  • Single: $733,500 (up from $722,000)
  • Couple (combined): $1,102,500 (up from $1,085,000)

The asset test for homeowners excludes the value of primary place of residence.

Income and Deeming Changes

Centrelink’s deeming rules assume your financial investments earn a certain rate of income, regardless of what they actually return. From 1 July 2026, the threshold at which the higher deeming rate of 3.25 per cent applies has increased to $66,800 for singles (up from $64,200) and $110,600 for couples (up from $106,200). The fortnightly income-free area has also risen, to $226 for singles (up from $218) and $396 for couples (up from $380).

Income Test Cut-off (Per Fortnight)

  • Single: $2,627.80 (up from $2,619.80)
  • Couple (combined): $4,016.80 (up from $4,000.80)

Why This Could Matter To You

If you’ve built a significant portfolio of assessable private investments, direct shares, managed accounts, term deposits and similar holdings, there’s a good chance you’ve previously been assessed as ineligible for any age pension because your assets or deemed income sat just above the cut-off. With these thresholds now higher, that may no longer be the case.

“We’re seeing clients with substantial investment portfolios who assumed the age pension was simply off the table for them,” said Robert Tawil, Adviser at Vantage Wealth Management. “With these thresholds moving up, some of those same clients may now be entitled to a small part pension. The dollar amount might be modest, but it comes with a Pensioner Concession Card rather than the Commonwealth Seniors Health Card, and that card can translate into real, ongoing savings on healthcare and everyday costs. If your circumstances haven’t changed dramatically since you were last assessed, it’s worth checking again.”

What We Would Suggest

If your assets or income were previously close to these limits, now is a sensible time to revisit your position. Even a small part pension entitlement can bring valuable flexibility and concession benefits alongside it.

We’d welcome the opportunity to review your situation against the new thresholds and let you know whether they open up any entitlement for you. Please get in touch with your Vantage Wealth Management adviser to arrange a time.

*This article contains purely factual information and/or general advice and does not constitute personal financial product advice.  The content of this article does not take into account your personal objectives, financial situation or needs and you must determine whether it is appropriate to your situation.  We recommend you obtain financial, legal and taxation advice before making any financial investment decision.

About the Author:

Robert Tawil – Private Client Adviser – Vantage Wealth Management

Robert holds a Bachelor of Economics (Economics, Quantitative Economics, Money and Banking, and Finance) from the University of Western Australia and a Diploma of Financial Planning. This allowed him to qualify as a Certified Financial Planner®. He commenced working in the financial services industry in 2015 and is a member of the Financial Advice Association Australia.

Robert values building strong relationships that are founded on trust and is passionate about helping people take control of their financial affairs and achieve their goals.

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EOFY Is Days Away – Have You Reviewed Your Superannuation Contributions for the Year

Posted on by Sylvia Veale

Make the most of super before 30 June with smart contribution strategies that can reduce tax, grow retirement savings, and protect your family in a tax-effective way.

Concessional Contributions

Personal contributions where you lodge a Notice of Intent to claim a tax deduction can reduce your taxable income and may even shift your marginal rate. It is also worth checking whether your employer and personal concessional contributions are on track to make the most of the 2025/26 concessional contributions cap of $30,000.

Non-concessional Contributions

After-tax money into super that grows in a low-tax environment. If eligible, you may be able to contribute up to $120,000 this financial year or bring forward up to three years of contributions for a total of $360,000.

Spouse Contributions

If your spouse earns a low income or is not working, making an eligible after-tax contribution to their super may help build their retirement savings and may entitle you to a tax offset of up to $540, subject to eligibility criteria.

Children’s Super

Money to your kids so they can build their balance early and positioning them for the First Home Super Saver Scheme when the time comes.

Life Insurance Inside Super

Contributions can effectively fund premiums in a tax-effective structure, protecting your family at a lower after-tax cost and maintain fund balances.

These aren’t set-and-forget decisions – small actions before 30 June can have meaningful, lasting impact.

*This article contains purely factual information and/or general advice and does not constitute personal financial product advice.  The content of this article does not take into account your personal objectives, financial situation or needs and you must determine whether it is appropriate to your situation.  We recommend you obtain financial, legal and taxation advice before making any financial investment decision.

About the Author:

Ben Devenish – Managing Director – Vantage Wealth Management

Ben, commenced work in the financial services industry in 1993 and has held Executive Director, Private Client Adviser, and Responsible Manager (RM) positions since that time. Key responsibilities as Managing Director at Vantage are to manage operational functions to achieve group strategic objectives, stakeholders are engaged to ensure aligned objectives are achieved, and most critically a team-oriented culture is fostered.

He has also been a Private Client Adviser, Responsible Manager, Head of advice WA and held national advice board positions at Shadforth Financial Group over the period from 2005 till 2017. His qualifications include Australian Institute of Company Directors (AICD), Certified Financial Planner ™, London Business School 2018 (Exec MBA unit, Developing Strategy for Value Creation), Bachelor of Economics (BEcons UWA), Graduate Diploma in Applied Finance and Investment (FINSIA), Diploma in Financial Planning (DFP), Self-Managed Superannuation Fund (SMSF) Specialist Adviser and Registered Tax (Financial Adviser) status under the Tax Agent Services Act 2009.

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Worried About Your Children Ever Being Able to Buy a Home? There are ways to help that can save tax and give you peace of mind.

Posted on by Sylvia Veale

With the residential property market having leapt hundreds of thousands of dollars over recent years, a common concern for clients is how their kids will ever be able to get enough savings together to make a start.

Many parents want to help but they are often not sure of the best way to do it.

For some, that means gifting cash. For others, it might mean acting as guarantor on a loan or letting their child live at home for longer to save. There is another strategy often overlooked – the First Home Super Saver Scheme (FHSSS).

Why Some Parents Are Using This Strategy

A common concern we hear from parents is:

“We want to help our child, but we also want to know the money is being used for a house deposit.”

That is where the FHSSS can be useful.

Rather than gifting $50,000 directly into your child’s bank account, parents may choose to help fund contributions into their child’s super over time.

Those funds generally cannot be accessed until retirement, death, significant disablement…. OR putting down a first home deposit.

That creates a level of accountability many parents appreciate.

What is the FHSSS?

The FHSSS allows eligible first home buyers (or in this case, parents on their behalf) to make voluntary contributions into super and later withdraw those funds to purchase their first home.

Key limits include:

  • Up to $15,000 per financial year
  • Up to $50,000 in total
  • Plus associated earnings

This can work well for parents who want to help fund their child’s deposit while ensuring the money is largely locked away for a first home purchase – not a European summer or a new car.

For full information, visit the following page:

ATO – First Home Super Saver Scheme

The Tax Benefit?

This is where the strategy can become even more attractive.

These contributions are generally taxed on their earnings at 15% inside super, which may be lower than their personal marginal tax rate if they are earning an income.

For someone earning a higher income, this can create meaningful tax savings while they save for a deposit. A key benefit is that your adult child can then potentially receive a tax deduction benefit for the contributions.

In a recent client example, Jane, a 30-year-old earning $120,000, had roughly $8,000 more available for a deposit by her parents contributing to her super fund, rather than providing her the same amount as cash.

Is it worth considering?

This strategy is not suitable for everyone.

There are rules around contribution caps, eligibility, tax treatment, and timing that need to be managed carefully.

But for parents who want to:

  • Help their children enter the property market
  • Access potential tax benefits
  • Ensure the money is being used for a home deposit

…it can be a practical alternative to simply transferring cash and hoping it gets used wisely.

We regularly help families assess whether strategies like this fit within their broader financial plan, both for parents providing support and children trying to enter the property market.

About the Author:

Luke Pirozzi – Private Client Adviser – Vantage Wealth Management

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Tax Advantaged Super Maximums Have Changed — Is Your Retirement Plan Still on Track?

Posted on by Sylvia Veale

If you’re in your 50s or early 60s, chances are you are starting to think more and more about how retirement will look. Some of the concepts you will probably be contemplating leaning into being:

  • Maximising super contributions in your last 10 years of work
  • Transitioning to retirement gradually
  • Drawing down on your super once you get it to a magical number

That plan may still be sound — but here’s the catch: superannuation rules don’t stand still.

Recent changes to contribution amounts and Total Super Balance (TSB) thresholds mean strategies that worked in the past may now need refinement. For many pre‑retirees, these changes can materially affect what’s still possible, what needs adjusting, and which opportunities could be missed.

Contribution Limits: Still Doing What You Thought They Would?

Contribution limits have increased due to indexation — good news, but only if your strategy keeps pace.

From 1 July 2026:

  • The concessional contributions cap increases from $30,000 to $32,500
  • The non‑concessional contributions cap increases from $120,000 to $130,000

For people approaching retirement, this often raises important questions:

  • Am I contributing the most I can — or relying on outdated limits?
  • Am I still eligible to use unused catch‑up concessional contributions?
  • Should my salary sacrifice or personal contribution strategy be adjusted?
  • Should I be balancing up contributions into my spouse’s super fund?

What we often see is people assuming they’ve “maxed out” super, when in reality, changes to the rules have reopened the door to additional planning opportunities.

Total Super Balance (TSB): The Quiet Rule That Changes Everything

From 1 July 2026, the Total Super Balance (total value of all your superannuation interests) threshold increases from $2.0 million to $2.1 million.

Your TSB plays a far bigger role than many people realise. It determines whether you can:

  • Make certain types of contributions
  • Use bring‑forward strategies
  • Access catch‑up concessional contributions
  • Implement specific retirement or estate planning strategies

As balances grow — sometimes faster than expected — people can unknowingly cross key thresholds. This can quietly close off opportunities they were relying on, or delay strategies that could otherwise be brought forward.

Just as importantly, indexation can also restore flexibility, particularly for those sitting close to previous limits.

Why Reviewing the Plan Matters

We work closely with clients to ensure their retirement strategy isn’t just well‑structured at the outset, but remains aligned as personal circumstances and superannuation rules evolve.

This isn’t about reacting to change — it’s about regularly reviewing the plan to make sure every lever still works as intended, and any new opportunities are identified early.

About the Author:

Robert Tawil – Private Client Adviser – Vantage Wealth Management

Robert holds a Bachelor of Economics (Economics, Quantitative Economics, Money and Banking, and Finance) from the University of Western Australia and a Diploma of Financial Planning. This allowed him to qualify as a Certified Financial Planner®. He commenced working in the financial services industry in 2015 and is a member of the Financial Advice Association Australia.

Robert values building strong relationships that are founded on trust and is passionate about helping people take control of their financial affairs and achieve their goals.

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