John Cameron's personal blog

Serious discussion about your financial position now - and in the future.

Four Points to Note About Recent Rants, Furphies and Beat-Ups Around Tax and Franking Credits.

There has recently been serious concerns expressed in major media, about investors in account based pensions (it applies to other vehicles as well, but most of the rant has been about pensions).

The “concern” goes like this: “because a lower company tax rate will mean companies are paying lower tax, the will have fewer franking credits to pass on, and investors will get smaller tax refunds.”

Oh, save me. There is a serious misunderstanding here.

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Pension Caps

Okay, at the risk of being beaten up by well-heeled senior citizens (It’s OK, I’m one myself) wielding folded budget papers, I will say it:

     “I support the Government’s action to limit the amount held in an allocated pension to $1.6million.”

There, I have said it.

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Superannuation Changes Are Not Retrospective!

There. I’ve said it.

There are many reasons to criticise the superannuation changes announced in the budget (more on that next time), but retrospectivity is not one of them. Why? Because they are not retrospective.

Much of the considerable amount of criticism has been around the changes being “retrospective”. However, there is confusion between “retrospectivity” and “grandfathering”.

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