The commissioner of taxation1 has announced that it has paid co-contributions to 1.4 million Australians. The amount paid out was $1.28 million, which means that the average payment was around $900 - well below the full amount on offer of $1,500.

This indicates that the average taxpayer taking advantage of the co-contribution is earning well above the minimum threshold. Other reports suggest that it is being utilised far more by the spouses and children of high income earners with high disposable incomes and semi-retired wealthy taxpayers – which, arguably, is not what the Australian Government intended.

The government is not blind to this and the rules governing the co-contribution are constantly being changed to prevent certain taxpayers from taking advantage of incentives not specifically designed for them. If any changes are going to be made it could be in the Federal budget in May, but usually such changes won’t take effect until the following financial year.

Each year we release a Budget edition newsletter which translates the financial jargon into plain English so if this opportunity is about to disappear we will let you know. But in the meantime, you may want to plan ahead and consider putting $1,000 into your own superannuation account, your spouses or even your teenagers who are working part-time. The bonus of $1,500 may not be on offer for much longer...

Notes:
1. www.ato.gov.au/super/content.asp?doc=/content/00170978.htm

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