Carry Forward Superannuation Contributions

Many within the mining, oil, and gas industries pay substantial annual taxes. With tax burdens reaching up to 47% on earnings exceeding $180,000, it becomes crucial to explore avenues for tax savings.

One effective method to mitigate these tax challenges involves making use of superannuation contributions. Miners can opt for superannuation or salary sacrifice contributions, enabling them to contribute pre-tax funds to their superannuation accounts. However, given that many miners already earn well above $200,000, there is often limited room for additional contributions to superannuation.

A frequently overlooked tactic in this context is the utilization of carry-forward concessional contributions. This enables miners to carry forward up to five years' worth of unused concessional contributions from the 2018-2019 financial year, provided their superannuation balance is below $500,000 at the end of the preceding financial year. This strategy proves particularly beneficial when a miner, earning $200,000 or more, sells an asset subject to capital gains tax (CGT). The contribution can be applied to mitigate the gain, thereby increasing the funds retained by the individual.

However, it is crucial to bear in mind that exceeding this contribution limit incurs penalties. Therefore, seeking advice from an expert is advisable beforemaking such contributions to ensure their continued relevance to individual circumstances.

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