Educational Series Do you earn under $61,920? Let the Government top up your super For each $1 you add as a personal after-tax contribution1, the Government will co-contribute $1 up to a maximum of $1,000 provided you meet the eligibility conditions. Am I eligible? Your Super contribution: $1,000 $800 $500 $200 From 1 July 2007, both employed and self-employed people may If you earn 2 The Government will contribute be eligible for a super co-contribution. If you can answer YES to all of these questions, in relation to a financial year, then you will $31,920 or less $1,000 $800 $500 $200 be entitled to a super co-contribution from the Government. $35,000 $897 $800 $500 $200 $40,000 $731 $731 $500 $200 Have you made, or are you prepared to make, $45,000 $564 $564 $500 $200 personal contributions to your super for which you n Yes n No will not claim a tax deduction?1 $50,000 $398 $398 $398 $200 Will you earn less than $61,9202 in the 2009/10 $55,000 $231 $231 $231 $200 financial year before tax (individual income, n Yes n No $60,000 $65 $65 $65 $65 not household)? $61,920 or more $0 $0 $0 $0 Do you earn more than 10% of your total income from being employed3 or from carrying on a n Yes n No For example, an eligible person who earns $25,000 is entitled to business? maximum co-contribution of $1,000. If that person contributes Are you under 71 years of age at the end of the 2009/10 financial year? n Yes n No $500 to super, their co-contribution will be $500; if they Have you or will you lodge an income tax return? contribute more then their co-contribution would also increase, n Yes n No up to the $1,000 maximum. An eligible person who earns Are you a permanent resident, or citizen of Australia?4 n Yes n No $40,000 will receive a maximum co-contribution of $731 if they contribute $1,000 to super. How much would I receive? This depends on whether you meet the eligibility conditions, the amount of income you earn and how much you add to your super5. The following table shows what the Government’s co-contribution will be based on your own contributions of $1,000, $800, $500 or $200. 1 Contributions made by your spouse and employer do not count. 2 Assessable income and reportable fringe benefits and reportable employer super contributions less business deductions (except for super contributions or work-related expenses) for the 2009/10 financial year. The lower threshold is indexed annually to AWOTE. The upper threshold is $30,000 higher than the lower threshold. 3 Eligible employment includes any arrangement where an employer is required to treat a person as an employee for the superannuation guarantee rules. Excludes fully retired people. 4 You are not eligible if you hold a temporary resident visa, for more information visit www.ato.com.au. 5 There is a cap on the amount of after tax contributions you can make without paying higher rates of tax. In 2009/10 the non-concessional cap is $150,000 per year, or $450,000 over three years if you are under age 65 in the financial year. Why should I worry about it? What do I need to do? A little more in your super now could mean a lot more in the future. To take advantage of the Government’s co-contribution scheme, you The example in the chart below shows how much difference can top up your super any time via Direct Credit or Bpay® through the co-contribution can make to your super balance in 20 years’ internet or phone banking, or fill out the deposit slip overleaf. time. The orange shaded area in the chart shows how much Log on to your bank’s website and click on the option extra you would have in your super if you make after tax personal to transfer funds. Then enter your: contributions and are entitled to Government co-contributions. BSB 062-778 The benefits of co-contributions Account number This is the last 9 digits of your I Compulsory super plus personal and Government co-contribution Colonial First State account number 200,000 I Compulsory super only 184,943 eg if your account number is 0100 Estimated final super balance 150,000 170,910 1234 5678, the bank account for 156,876 136,397 148,764 direct credit would be: 012345678. 125,293 (Your account number can be 100,000 101,823 found in the top right hand corner 78,352 on any of your statements) 50,000 Account name This is your first name and surname 0 Reference Please enter MV in the first two 25,000 35,000 45,000 55,000 Annual income spaces (for your member voluntary This chart is for illustrative purposes only and does not represent actual returns. superannuation account contribution) A change in one or more of the variables and assumptions will produce different results. This Please note: If MV is not entered correctly, your is general information only and does not take into account your individual objectives, financial situation or needs. The following assumptions have been allowed for: Starting account balance contribution will be entered as a superannuation guarantee is $10,000; employer contributions are 9% of salary, paid monthly to the super fund for 20 contribution which does not qualify for a co-contribution. years. Fund earnings are assumed to be 6.5% per annum, after taxation of 15% and after fees. Results are shown for different levels of assessable income, with no reportable fringe benefits, Log on to your bank’s website or call your bank’s phone increasing by 4.0% each year. All results are in today’s dollars, allowing for inflation at a rate of 3.0% per annum Maximum co-contributions are: $1,000 from 1 July 2009 to 30 June 2012, banking and select the option to transfer funds. Then $1,250 from 1 July 2012 to 30 June 2014, then $1,500 from 1 July 2014 onwards. provide the relevant biller code and your customer For example, Terry is 45 years and earns $25,000 pa and reference number. contributes $1,000 of his own money to his super at the end of each year over the next 20 years. Based on Terry’s income, the Biller codes: Superannuation Government will contribute up to $1,000 a year to Terry’s super Personal contribution type account – tax-free. In this situation, and given the assumptions, Rollover & Superannuation Fund 78857 shown above in the charts, Terry could retire almost $60,000 FirstChoice Personal Super 414334 over and above what he would have if he didn’t take advantage FirstChoice Wholesale Personal Super 485441 of the co-contribution scheme. Even if Terry earned $45,000 he FirstChoice Employer Super 414375 could still benefit by over $45,000 in retirement. Your customer reference number is the digit 1 plus your account When would the Government number (your account number can be found in the top right hand corner of any of your statements). top up my super? If you are eligible and have lodged your annual tax return, the Australian Taxation Office (ATO) willl: W Work out your super co-contribution W Deposit it into your super account, and W Send you a letter with details of your super co-contribution. Payments are generally made in November/December each year. To find out more Talk to your financial adviser, call us on 13 13 36 or visit out website at colonialfirststate.com.au. This flyer provides general information and is not financial advice. It does not take into account your individual objectives, financial situation or needs. You should read the relevant Product 13557/FS2295/0709 Disclosure Statement (PDSs) and assess whether the information is appropriate and consider talking to your financial adviser or taxation specialist before making an investment decision. The flyer assumes that the current taxation and superannuation laws as at 1 July 2009 will continue to apply without any change. Colonial First State Investments Limited ABN 98 002 348 352, AFS Licence 232468 (Colonial First State) is the issuer of interests in FirstChoice Personal Super, FirstChoice Wholesale Personal Super, FirstChoice Pension, FirstChoice Wholesale Pension and FirstChoice Employer Super from the Colonial First State FirstChoice Superannuation Trust ABN 26 458 298 557 and interests in the Rollover & Superannuation Fund and the Personal Pension Plan from the Colonial First State Rollover & Superannuation Fund ABN 88 854 638 840 and interests in the Colonial First State Pooled Superannuation Trust ABN 51 982 884 624. ® Registered to Bpay Pty Ltd ABN 69 079 137 518.