This article provides information on the increase of the lifetime limit of the Transfer Balance Cap from 1st July 2021 and the changes in Class that support this change. The general transfer balance cap is indexed by $100,000 periodically, and it will now increase from $1.6 million to $1.7 million.

There is no longer a single cap applicable to everyone, each member shall have their own personal transfer balance cap depending on the highest utilisation of the cap prior to 30th June 2021.

Calculation of the Personal Transfer Balance Cap (after Indexation)

The proportional indexation of the individual's personal transfer balance cap is calculated by:

• Identifying the highest ever (end of the day) balance in the member's transfer balance account until 30th June 2021.
• Using that to calculate the unused cap percentage of the member's transfer balance account
• Multiplying the member's unused cap percentage by $100,000

Worked Example 

Areas of Class Affected

On 1st July 2021, the indexation increase shall automatically be applied to all eligible member's transfer balance accounts in Class.

(1) Member Console

On selection of the Financial Year 2021-22 or higher, a new tab “Personal Transfer Balance Cap” shall be displayed under the Member Console both at Business and Fund level with the following columns: 

1. Code (Fund code) 
2. Fund (Name of the super fund) 
3. Member Name (Name of the relevant member) 
4. Date of Birth (Date of birth of the member) 
5. Age (The current age of the member) 
6. Personal Transfer Balance Cap –Lifetime limit on the total amount of superannuation that can be transferred into retirement phase income stream up to the date of the last indexation (1 July 2021 Indexation)
7. Highest Ever Transfer Balance –Highest end of the day balance of a Transfer balance account prior to the last indexation date (1 July 2021 Indexation)
8. Indexation Entitlement –Eligibility of the member for indexation to the Transfer balance cap prior to the last indexation date (1 July 2021 Indexation). Members who have utilised their Personal Transfer Balance Cap before the indexation are not eligible for indexation.

(2) Filters (Member & Pension Balances )

When the selected filter is Financial year is prior to 2020-21 below options are displayed:

• Pension ≥ $1.6m (Pension accounts with balances that are greater than or equal to $1.6m) 

• Balance ≥ $1.6m (Members with balances that are greater than or equal to $1.6m) 
• Balance < $500K (Members with balances that are below $500K) 
• Over Transfer Balance Cap (Members with transfer balance account exceeded the Transfer Balance Cap) 
• Under Transfer Balance Cap (Members with transfer balance account under the Transfer Balance Cap) 

When the selected filter is Financial year is 2021-22 or later, the below options are available:

• Pension ≥ $1.7m (Pension accounts with balances that are greater than or equal to $1.7m) 
• Balance ≥ $1.7m (Members with balances that are greater than or equal to $1.7m) 
• Balance < $500K (Members with balances that are below $500K) 
• Over Personal Transfer Balance Cap (Members with transfer balance account exceeded the Personal Transfer Balance Cap) 
• Under Personal Transfer Balance Cap (Members with transfer balance account under the Personal Transfer Balance Cap) 

(3) Maintain member

As of 1st July 2021, information relating to member’s Personal Transfer Balance Cap shall be available from Browse Member > Maintain member screen:

(4) TBAR Console > Transfer Balance Account

As of 1st July 2021, all eligible Transfer balance accounts should show an additional Indexation record denoting the effective increase (if eligible) in the Remaining Cap column. This is an information record and does not form part of TBAR reporting:

How to adjust the highest transfer balance amount?

If the highest ever transfer balance needs to be adjusted, one needs to create an adjustment manual TBAR event through TBAR console on the same day of the transfer to correct the transfer balance using a correct event type:

Non-Concessional Contribution (NCC) Cap and Bring Forward Rule 

• The total superannuation balance limit that determines if an individual has a non-concessional contributions cap of nil will increase from $1.6 to $1.7 million.
• From 1 July 2021, the non-concessional contributions cap will increase from $100,000 to $110,000.
• $110,000 p.a. or up to $330,000 if 3 year bring forward rule (BFR) is applied and member is under age 67 at 1 July 2021.  
• Eligibility to make NCC is dependent on individuals having a total superannuation balance (TSB) < $1.7m at the end of 30 June of the previous financial year.
  

Other related Class articles:

Personal Transfer Balance Cap

Tracking of Transfer Balance Account

Transfer Balance Cap Indexation 1 July 2023