Accountants say many more people will be affected by superannuation changes in the 2016 Budget than the Government estimates.
A poll by CPA Australia of members in public practice has found 70% of respondents believe the Government’s superannuation changes will affect over 6% of their clients.
Almost 40% of respondents said over 20% of their clients would be affected. More than a quarter estimate 30% of their clients will be affected.
“The findings are in stark contrast to the Government’s insistence that the changes will only affect a very small percentage of Australians,” said CPA Australia.
CPA Australia chief executive Alex Malley said the poll confirmed the changes have resulted in widespread uncertainty and confusion.
“When the changes were announced on budget night we said they had been made without consultation and the Government was completely underestimating the impact they would have,” he said.
“Our members are at the coal face every day advising Australians, young and old, from all socioeconomic groups, about their retirement savings options. They have been inundated with questions from their clients about what these changes will mean to retirement savings.”
“Instinctively we knew that wasn’t right and so we decided to poll our members to get a sense of the magnitude of the issue,” said Mr Malley.
“Our results clearly show that the Government has underestimated the impact of its changes.”
“The changes were announced less than a week before the Government called the election and went into caretaker mode meaning there will be no more details forthcoming about how this will work.”
“The Government seems to be scrambling to explain the changes and Treasury can’t give us any extra detail.”
“The ATO has been blindsided to the point of having to issue a special request to all tax agents to try and help it manage the extra workload.”
The ATO has said it is having to manually calculate total non-concessional contributions for taxpayers, following the Budget announcement of a $500,000 lifetime non-concessional contributions cap.
“The Government must listen to the concerns being raised. People need certainty and security to plan for their retirement – the new rules as proposed will deliver neither,” Mr Malley said.
ASFA has estimated that 1,260,000 people will be worse off under the 2016 Budget changes to superannuation.