Some super savers over 55 with less than $500,000 in their retirement savings have a “sweet spot” opportunity to contribute almost $900,000 in one calendar year.

Making the most of catch-up concessional (pre-tax) and “bring forward” non-concessional (after-tax) contributions plus using the popular downsizer contribution could enable contributions of $897,500, says Adrian Raftery, principal of chartered accountant Mr Taxman.

“This would be a sweet spot for someone aged 55 to 75 with a super balance under $500,000 and who has made minimal contributions in the past five years,” Raftery says. “For example, it sounds very much like a strategy for an empty nester preparing for retirement who has just received a windfall gain, such as an inheritance from parents.”

This is also a reminder for other super savers to make the most of generous tax concessions when saving for retirement.

But there are certain boxes to tick, he says.

To avoid confusion, super funds need to be alerted in writing what each contribution is. For example, if you don’t notify the super fund about a downsizer contribution, it will form part of your non-concessional contribution limit. Downsizer contributions don’t count towards the $110,000 annual cap.

Article can be found here in Financial Review