The implications of going guarantor on a mortgage – Sydney Morning Herald

Posted: July 5, 2021 at 5:37 am

However, in calculating a persons income for the CSHC income test, a reference tax year is used usually the tax year immediately preceding the current tax year.

If a persons income for the reference tax year is above the CSHC income limits and they can show that the source of the increased income is of a one-off nature then, subject to certain conditions, they may give an estimate of their income for the current tax year.

Services Australia would consider a range of factors on a case-by-case basis when determining what income estimate can be used for eligibility purposes.

The spokesperson suggests that you test your eligibility for the CSHC by making a claim.

If the abolition of the work test for non-concessional superannuation contributions becomes effective from July 1, 2022, and I turn 72 in that financial year, can I use the bring-forward rule and deposit $330,000 into my Self-Managed Super Fund that year and another $330,000 in the 2025-2026 financial year?

John Perri, of AMP Technical Services, says there is an expectation that the bring-forward rule would be available to individuals aged 67-74 when the federal government amends the legislation to abolish the work test for non-concessional contributions from July, 2022.

If that is the case and as you will be aged 71 at July 1, 2022, (though you are turning 72 in that financial year) then, assuming your total super balance at June 30, 2022, is less than $1.48 million, you could use the bring-forward rules to make a non-concessional contribution of $330,000. This would mean you could not make any further non-concessional contributions till July 1, 2025, at which point you would be 74.

It would be necessary to see the legislation in detail before answering the second part of your question. The ability to use three years of bring-forward contributions at age 74 may not be available, given no non-concessional contributions could be made at age 75 and 76.

I receive a full age pension as I have no assets. If I won a house in a lottery, would I lose my pension?

When you say you have no assets, I assume that means you do not own a house. Therefore, if you won a house in a lottery and live in that house, it would be an exempt asset and would not affect your pension.

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If you sold the property and bought a cheaper house to live in, you would need to seek financial advice, as the capital released on the sale could be sufficient to have an effect on your pension.

A single pensioner homeowner can have assessable assets of up to $268,000 with no effect on their pension. However, the income test cut-off point is $178 a fortnight. If you had deemed assets of $260,000 this could just take you over the bottom threshold.

Noel Whittaker is the author of Making Money Made Simple and numerous other books on personal finance. noel@noelwhittaker.com.au

Originally posted here:

The implications of going guarantor on a mortgage - Sydney Morning Herald

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