TBC set to increase from $1.7 million to $1.9 million

Following the recent announcement that the inflation figures hit a 33 year high of 7.8 percent, it is very likely (unless the government intervenes) that the Transfer Balance Cap (TBC) will increase from $1.7 million to $1.9 million on the 1^st July 2023.

The reason being that the indexation of the TBC is reference to movements in the consumer price index (CPI) which is set to increase by a factor of two.

Given that the TBC is linked to the Total Super Balance threshold if the TBC amount is increased it will also affect the amount that members contribute to super and the strategies they use to maximise their super. This includes using the non-concessional contribution bring forward rules, downsizer contributions, spouse splitting contributions, etc.

At the very least advisers and Trustees should be aware of the possible changes to the TBC amounts.

https://www.smsfadviser.com/news/21998-double-indexation-of-tbc-almost-certain-says-bt