Low Income Super Contriubution

A new government super payment, called the low income super contribution (LISC), started on 1 July 2012. It will help eligible low-income earners save for their retirement.

LISC is for people who earn $37,000 or less per year (adjusted taxable income). People who are eligible for LISC will get a government super payment that is 15% of their concessional super contributions - up to a maximum of $500.

Taxpayers don't need to apply for a LISC. The ATO will work out their eligibility using information on their income tax return or, if they don't lodge a tax return, using other information they collect.

Taxpayers will receive electronic LISC payments directly to their super fund. Payments will be made within 14 months from the end of the financial year in which the concessional contributions were made. The first payments will be in the 2013-14 financial year.

Once a super fund receives an LISC for a member they will need to allocate it to the taxpayers account and advise members in their account statement.

Taxpayers will also need to make sure they advise their super fund of their tax file numbers (TFN) to receive a LISC.

The existing super co-contribution program also aims to boost the super of low- to middle-income earners. The super co-contribution continues in the 2012-13 financial year.
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