The Australian Labor government’s proposed changes to superannuation tax rules have sparked serious concern among investors, retirees, and financial professionals. Experts are warning that these changes could damage the very foundations of Australia’s retirement system — the “lifeblood of Australia” — and lead to unintended financial consequences for many Australians.
At Boa & Co. Chartered Accountants, we want to ensure our clients stay informed and protected. Here’s what you need to know.
What Are the Proposed Changes?
Labor’s proposal includes:
- Doubling the tax rate on superannuation balances over $3 million from 15% to 30%.
- Introducing tax on unrealised capital gains — meaning you may have to pay tax on asset value increases even if you haven’t sold the asset.
- No indexation of the $3 million threshold, meaning over time, more Australians will be impacted as inflation rises.
These changes would apply to assets inside super funds, including properties, farms, or business premises held by self-managed super funds (SMSFs).
Why Are Experts Alarmed?
Geoff Wilson, founder of Wilson Asset Management, strongly warns that taxing unrealised gains could cause:
- People to withdraw money from super funds to avoid unexpected taxes.
- Reduced investments in Australian businesses and startups.
- Higher housing prices, as people move investments into the property market.
- Disadvantages for self-employed Australians, farmers, and small business owners.
Financial planner Alex Jamieson added that these changes would severely impact those owning non-liquid assets like commercial properties through their super funds, potentially forcing them into large tax bills without actual cash flow.
Who Will Be Affected?
- Self-Managed Super Fund (SMSF) holders
- Business owners using their super to own commercial property
- Farmers and those with property investments
- High net worth individuals nearing or exceeding the $3 million super balance
Even though the government claims only 0.5% of Australians (around 80,000 people) would be impacted initially, without indexation, the Financial Services Council warns that up to 500,000 Australians could eventually be affected — including young Australians under 30.
Real Consequences Already Happening
Investors are already making major moves to avoid being caught by the proposed laws:
- Selling assets early to avoid future taxes.
- Withdrawing large sums from their super funds.
- Gifting assets to children and grandchildren to keep balances below the $3 million threshold.
Geoff Wilson shared that a client with over $3 million in super has already decided to withdraw funds and gift them to his grandchildren for home purchases — a direct result of the fear these policies are creating.
What You Should Do Now
Early financial planning is crucial to protect your wealth from these potential changes.
- Review your superannuation balance
- Understand your exposure to unrealised gains
- Plan ahead to manage future tax liabilities
- Consider restructuring your investments
- Seek professional advice early
How Boa & Co. Chartered Accountants Can Help You
At Boa & Co., our expert accountants and financial planners are ready to assist you in navigating these proposed changes. We offer:
- Superannuation strategy reviews
- Tax-effective wealth planning
- Self-Managed Super Fund (SMSF) advice
- Business structuring and asset protection strategies
We work closely with you to ensure your financial future is secure — no matter what changes come.
Call us today at 1300 952 286
Email us at [email protected]
Visit www.boanco.com.au for more information
Don’t leave your retirement savings at risk. Partner with Boa & Co. today and plan ahead with confidence!