The following notes set out further details about the assumptions used in the calculations carried out by this calculator.
General wage inflation
By default, wages are assumed to increase by 3.5% p.a. in each year. All results are expressed in today's dollars by discounting at this rate. You can change the assumed rate on the "Assumptions" tab.
Your salary is assumed to increase each year in line with the assumed level of general wage inflation. Income tax is calculated by applying personal income tax rates plus the Medicare Levy (but not the Medicare Levy Surcharge) to your projected taxable income in each projection year. The personal income tax rates used for the 2018/19 projection year are the legislated tax rates as at 1 July 2018. In each projected year subsequent to 2018/19, the personal income tax brackets (and Medicare Levy thresholds) are assumed to increase in line with the assumed level of general wage inflation, and the personal income tax rates are assumed to remain unchanged. You are assumed to be an Australian resident for taxation purposes. In calculating the Medicare Levy, the individual income thresholds are assumed to apply, and the family income thresholds are assumed not to apply.
The Medicare Levy is assumed to be 2% of taxable income for the 2018/19 tax year and subsequent years.
In each projection year, your entitlement for the Low Income Tax Offset (LITO) is estimated based on your taxable income. The rates and thresholds used to calculate LITO in the 2018/19 projection year are assumed to be the legislated rates and thresholds as at 1 July 2018. The maximum amount of LITO and the income threshold over which the LITO starts to reduce are assumed to increase each year subsequent to 2018/19 in line with the assumed level of general wage inflation.
In each projection year in which you are determined to be eligible for an Age Pension, your entitlement for the Seniors and Pensioners Tax Offset (SAPTO) is estimated based on your rebatable income. Your rebatable income is assumed to equal your taxable income plus any salary sacrifice contributions. The maximum amount of SAPTO is assumed to increase each year in line with the assumed level of general wage inflation.
No allowance has been made for income from any other sources, including your spouse's income.
By default, you are assumed to receive employer superannuation contributions of 9.5% of salary, subject to a maximum of your concessional contribution cap. You can change the assumed employer contribution rate and your current level of salary sacrifice (concessional) and after-tax (non-concessional) contributions on the "Assumptions" tab. By default, in each projection year, if your employer's contribution rate is below the assumed Superannuation Guarantee (SG) Charge Rate for that year, your employer's contribution rate is increased to the assumed SG Charge Rate in that year. You can disable this functionality on the "Assumptions" tab. The SG Charge Rate assumed to apply in each year is as follows:
||Superannuation Guarantee charge rate (% p.a.)
|2016/17 - 2020/21
|2025/26 and thereafter
It is assumed that your employer contributions are not affected by any salary sacrifice contributions.
Any contributions entered by you (both employer and personal contributions) are assumed to increase in each projection year in line with your salary. Where a calculated contribution amount exceeds the relevant contribution cap, the assumed contribution is reduced to the amount of the contribution cap to ensure the contribution is not excessive.
The concessional and non-concessional contributions limits of $25,000 and $100,000 respectively are subject to indexation. The general transfer balance cap starts at $1.6 million for 2017/18, and will be indexed in line with the consumer price index (CPI), rounded down to the nearest $100,000. Contributions are assumed to be spread evenly across each projection year on a monthly basis and are to be paid until the retirement age you enter.
No allowance has been made for spouse contributions.
Where an individual's income exceeds $250,000 a year due to the inclusion of their concessional contributions, the higher tax rate of 30% is assumed to apply in the super fund to the excess over $250,000, with 15% applying to the balance of concessional contributions.
For each projection year in which you make a non-concessional contribution, your co-contribution eligibility is assessed and a co-contribution is added to the superannuation account if applicable.
Your eligibility is assessed by comparing your projected assessable income amount plus salary sacrifice contributions to the projected co-contribution thresholds, and applying the standard rules for calculating the co-contribution. It is assumed you have no reportable fringe benefits.
It is assumed you meet the other eligibility criteria.
The lower co-contribution threshold is assumed to increase in line with the assumed level of general wage inflation each year. The co-contribution matching rate is assumed to be 50c per dollar contributed and the maximum co-contribution is assumed to be $500. The upper co-contribution threshold is assumed to be $15,000 more than the lower co-contribution threshold. As assumptions have been made about your eligibility for the co-contribution, including your "relevant income", the projected co-contribution may not represent your actual co-contribution entitlement.
Any co-contribution payable is added to your superannuation account on 30 June in the respective projection year.
Low-Income Superannuation Tax Offset (LISTO)
For each projection year on or after 1 July 2017, in which it is assumed you or your employer would make a concessional contribution, your eligibility for the LISTO is assessed and a LISTO is added to the projected superannuation account if applicable.
In each case, your eligibility is assessed by comparing your calculated adjusted taxable income in the relevant year to the LISTO income threshold, and applying the standard rules for calculating the LISTO. It is assumed you have no reportable fringe benefits and that you meet the other LISTO eligibility criteria.
The LISTO income threshold and maximum payment amount are assumed to remain constant over the projection period.
Any LISTO payable is added to your projected superannuation account on 30 June in the respective projection year.
This tool is provided by Link Advice ABN 36 105 811 836, AFSL 258145, who is solely responsible for the accuracy of this tool and any assumptions upon which the projections are based. The projections made from this tool are based on the information you have provided and the assumptions.
The projections made from this tool are estimates only and are not guaranteed. You may get more or less depending on your personal circumstances. The results provided by this tool do not constitute financial advice. To the extent that any advice is provided, it does not take into account your objectives, financial situation or needs and you should consider whether it is appropriate for you. We strongly recommend you seek financial advice tailored to your own circumstances before you make any decisions about your investments.
Diversa Trustees Limited ABN 49 006 421 638, AFSL 235153, RSE L0000635 is the Trustee of the ING Superannuation Fund ABN 13 355 603 448 (Fund) and the issuer of interests in the Fund. ING Living Super is a product issued out of the Fund. ING, a division of ING Bank (Australia) Limited ABN 24 000 893 292, AFSL 229823, is the Promoter of the Fund. You should consider the Product Disclosure Statement available at ing.com.au in deciding whether to acquire, or to continue to hold the Living Super product.
Neither ING Bank (Australia) Limited, Diversa Trustees Limited nor Link Advice are liable for any loss or damage that is incurred by you as a result of relying on information provided by the tool.