Revived 120% deduction on digital and skills incentives


An election ago, the 2022-23 Budget proposed a 120% tax deduction for expenditure by small and medium businesses on technology, or skills and training for their staff. This proposal has now been adopted by the current Government and details released in a recent exposure draft by Treasury.



Two investment ‘boosts’ will be available to small and medium businesses with an aggregated annual turnover of less than $50 million:

  • Skills & Training Boost
  • Technology Investment Boost

The Skills and Training Boost is intended to apply to expenditure from 7.30pm ACT time on Budget night, 29 March 2022 until 30 June 2024. The business, however, will not be able to start claiming the bonus deduction until the 2023 tax return. That is, for expenditure incurred between 29 March 2022 and 30 June 2022, the additional 20% ‘boost’ deduction will not be claimable until the 2022-23 tax return (assuming the announced start dates are maintained if and when the legislation passes Parliament).

The Technology Investment Boost is intended to apply to expenditure from 7.30pm ACT time on Budget night, 29 March 2022 until 30 June 2023. As with the Skills and Training Boost, the additional 20% deduction for eligible expenditure incurred by 30 June 2022 will be claimed in the 2023 tax return.

The boost for eligible expenditure incurred on or after 1 July 2022 will be included in the income year in which the expenditure is incurred.

When it comes to expenditure on depreciating assets, the bonus deduction is equal to 20% of the cost of the asset that is used for a taxable purpose. This means that, regardless of the method of deduction that the entity takes (i.e., whether immediate or over time), the bonus deduction in respect of a depreciating asset is calculated based on the asset’s cost.


Technology Investment Boost

The Technology Investment Boost is a 120% tax deduction for expenditure incurred on business expenses and depreciating assets that support digital adoption, such as portable payment devices, cyber security systems, or subscriptions to cloud-based services.

The boost is capped at $100,000 per income year with a maximum deduction of $20,000.

To be eligible for the bonus deduction:

  • The expenditure must be eligible for deduction (salary and wage costs are excluded for the purpose of these rules)
  • The expenditure must have been incurred between 7.30pm (AEST), 29 March 2022 and 30 June 2023
  • If the expenditure is on a depreciating asset, the asset must be first used or installed ready for use by 30 June 2023.

To be eligible, the expenditure must be wholly or substantially for the entity’s digital operations or digitising its operations. For example:

  • digital enabling items – computer and telecommunications hardware and equipment, software, systems and services that form and facilitate the use of computer networks;
  • digital media and marketing – audio and visual content that can be created, accessed, stored or viewed on digital devices; and
  • e-commerce – supporting digitally ordered or platform enabled online transactions.

Repair and maintenance costs can be claimed as long as the expenses meet the eligibility criteria. Where the expenditure has mixed use (i.e., partly private), the bonus deduction applies to the proportion of the expenditure that is for an assessable income producing purpose.

The bonus deduction is not intended to cover general operating costs relating to employing staff, raising capital, the construction of the business premises, and the cost of goods and services the business sells. The boost will not apply to:

  • Assets that are sold while the boost is available
  • Capital works costs (for example, improvements to a building used as business premises)
  • Financing costs such as interest expenses
  • Salary or wage costs
  • Training or education costs
  • Trading stock or the cost of trading stock

For example:

A Co Pty Ltd (A Co) is a small business entity. On 15 July 2022, A Co purchased multiple laptops to allow its employees to work from home. The total cost was $100,000 (GST-exclusive). The laptops were delivered on 19 July 2022 and immediately issued to staff entirely for business use. As the holder of the assets, A Co is entitled to claim a deduction for the depreciation of a capital expense.

A Co can claim the full purchase price of the laptops ($100,000) as a deduction under temporary full expensing in its 2022-23 income tax return. It can also claim the maximum $20,000 bonus deduction in its 2022-23 income tax return.

The $20,000 bonus deduction is not paid to the business in cash but is used to offset against A Co’s assessable income. If the company is in a loss position, then the bonus deduction would increase the tax loss. The cash value to the business of the bonus deduction will depend on whether it generates a taxable profit or loss during the relevant year and the rate of tax that applies.


Skills and Training Boost

The Skills and Training boost is a 120% tax deduction for expenditure incurred on external training courses provided to employees.

External training courses will need to be provided to employees in Australia or online, and delivered by training organisations registered in Australia.

To be eligible for the bonus deduction:

  • The expenditure must be for training employees, either in-person in Australia, or online
  • The expenditure must be charged, directly or indirectly, by a registered training provider and be for training within the scope (if any) of the provider’s registration
  • The registered training provider must not be the small business or an associate of the small business
  • The expenditure must be deductible
  • Enrolment for the training must be on or after 7.30pm, 29 March 2022.

The training must be necessarily incurred in carrying on a business for the purpose of gaining or producing income. That is, there needs to be a nexus between the training provided and how the business produces its income.

Only the amount charged by the training organisation is deductible. In some circumstances, this might include incidental costs such as manuals and books, but only if charged by the training organisation.

Some exclusions will apply, such as for in-house or on-the-job training and expenditure on external training courses for persons other than employees. The training boost is not available to:

  • Sole traders, partners in a partnership, or independent contractors (who are not employees)
  • Associates of the business such as a relative, spouse or partner of an entity or person, a trustee of a trust that benefits an entity or person and a company that is sufficiently influenced by an entity or person.


For example:

Cockablue Pets Pty Ltd is a small business entity that operates a veterinary centre. The business recently took on a new employee to assist with jobs across the centre. The employee has some prior experience in animal studies and is keen to upskill to become a veterinary nurse. The business pays $3,500 (GST exclusive) for the employee to undertake external training in veterinary nursing. The training is delivered by a registered training provider, whose scope of registration includes veterinary nursing.

The bonus deduction is calculated as 20% of 100% of the amount of expenditure that can be deducted under another provision of the taxation law. In this case, the full $3,500 is deductible under section 8-1 of the ITAA 1997 as a business operating expense. Assuming the other eligibility criteria for the bonus deduction are satisfied, the bonus deduction is calculated as 20% of $3,500. That is, $700.

In this example, the bonus deduction available is $700. That does not mean the business receives $700 back from the ATO in cash, it means that the business is able to reduce its taxable income by $700. If the company has a positive amount of taxable income for the year and is subject to a 25% tax rate, then the net impact is a reduction in the company’s tax liability of $175. This also means that the company will generate fewer franking credits, which could mean more top-up tax needs to be paid when the company pays out its profits as dividends to the shareholders.

Any queries or need help with your business? Contact our friendly team of trusted advisors at Glance Consultants on 03 98859793 or at

FBT Exemption for EVs


There has been a new Bill proposed in Parliament – one made in a bid to incentivise electric car purchases by removing fringe benefits tax (FBT).

This proposed FBT exemption will reduce costs for a few thousand owners each year. The first year cost is around $20 million, reaching $90 million by 2025/2026. 

The removal of FBT from electric, plug-in hybrid and hydrogen cars that are supplied by employers to staff, if the vehicle price is below the luxury car tax threshold (which is $84,916 for the financial year 2022-2023), would benefit business financially.

It could save an employer $9,000 for an EV costing $50,000, or $4,700 where the arrangement includes salary sacrificing.

If enacted, the Bill will apply to all eligible vehicles first held and used on or after 1 July 2022. 

There is confidence that this move will lower the barrier to the uptake of EVs in Australia. It will encourage more affordable vehicles into the market, which is a welcome relief in the face of the rising cost of fuel. 

There are some implications of this proposed Bill that have been observed.

For example, gifting an EV to an employee will not allow for FBT exemptions as technically this would make it a ‘property benefit’ and not a ‘car benefit’.

Some concern has been expressed regarding reportable fringe benefit amounts (RFBAs) and how providing use of an eligible EV will still be included in determining this amount. 

However, this should not be too much of a deterrent for those willing to benefit from the proposed scheme, as the approach does seem equitable when considering RFBAs are used to determine various other entitlements. 

There is also the issue of the lack of supply, which is a critical factor that is stagnating the uptake in Australia. This contributes to inflated prices and although we may eventually reach a second-hand market, data is thin on the resale value of EVs.

The threshold which is just shy of $85,000 does encompass several brands available in the Australian market today, however does not accommodate the cost of additional features and modifications that some businesses may wish to purchase. 

If you like to understand the benefits of this proposed measure to you and your business, the team at Glance Consultants are happy to assist. Call us now on 03 98859793 or email us at



Conflicts of an Older Man Internet dating a 10 years younger Woman

If you’re an older man Selecting Quality Fits Through Cost-free Chinese Online dating sites – Gospel Hochzeit dating a younger woman, you probably have your own personal set of romance issues to deal with. As the majority of them are less difficult when you’re dealing with a spouse who’s older than you, there are some distinct challenges that come with dating a person of a different age.

brides in russia

Getting Started

When you are in a romance How to Ask a Girl to be Your Girlfriend Online – Simple Detailed Guide with someone who is definitely significantly older than you, is actually extremely important to get on similar page from the start. Including talking about your expectations and so that both you and he have the same understanding of what a successful relationship looks like.

You’re likewise likely Could you Purchase a Filipino Better half With the assistance of a relationship Firm? to have a unique point of view on things like home, religion, and job. While this is certainly fun and difficult inside the early days, it may also cause some significant issues as time goes on if the two companions don’t have a common goal and vision because of their upcoming.


Another issue that’s frequently found in aged man 10 years younger woman human relationships is usually communication. This is a serious challenge to navigate in the early days of your relationship because it’s often problematic for someone of your older 10 Common Phrases Found In Guys’ Online Dating Bios generation to relate to somebody who is younger in terms of how they will communicate.

However , it can also be a great way to understand how one another expresses the emotions and to make 7 Amazing Wedding Traditions Around the World – HomeToGo sure both of you appreciate what’s going about with the additional. This can help to build a stronger bond regarding the two of you and ensure that your relationship lasts for a long time.

Old men are typically more grounded than their newer counterparts, which could be a positive factor for a new woman who also isn’t used to having a stable relationship in her existence.

They’re generally more comfortable using their own money and also have a beat to their lives that makes sense for peaceful evenings in the home, Sunday brunches, or shore holidays with each other.

You should also take into consideration the fact that your more aged partner might have more disposable income than you do, which means this Russian Mail Buy Brides – Matchmaking With respect to Foreign Males – HD & SFX Master Makeup Artist could be a good incentive for him to invest in the relationship and take care of you financially.

It’s important to show patience and keep in mind that this type of relationship may not be as fast-paced as a traditional one, but it surely is worth the wait for you plus your partner to get the perfect match.

Finally, all of these problems can be triumph over if you’re happy to work at these people. If you’re certainly not willing to do this, you might want to consider moving on.

The Adult-Child Marriage Dynamic

Another popular justification that people date a far older spouse is because they think that the relationship can be a sort of “caretaking. inches This can be accurate for both equally sexes, and it is a great age-old custom that still is accessible in some cultures.

The older man might be considering taking the smaller woman on vacation and displaying some of the particular world is providing, and this can be a very attractive characteristic for her.

Glance Consultants September 2022 Newsletter

The tax consequences of land subdivision

It’s quite common for individuals to subdivide land they own, and then sell off one of the blocks. Depending on the circumstances, this can have capital gains tax (CGT) and GST implications.

Capital gains tax

If you subdivide a block of land, each resulting block is registered with a separate title. For capital gains tax (CGT) purposes, the original land parcel is divided into two or more separate assets.

The profit from selling subdivided land may be a capital gain or ordinary income, depending on the circumstances.

If you subdivide a block of land and sell the new block, any profit is generally treated as a capital gain subject to CGT.

However, any profit you make is treated as ordinary income (not a capital gain) if both of the following apply:

  • your intention or purpose in subdividing was to make a profit
  • the profit was made in the course of carrying on a business, a business operation or commercial transaction.

This is true even if you aren’t in business (for example, if it’s a one-off transaction by an individual).

Where the amount is treated as ordinary income, CGT concessions (such as the 50% discount) are not available.

If you sell any land separately from your home, it is invariably subject to CGT.

Only land sold with the home that is your main residence can receive the main residence exemption. Land is adjacent to your home if it is close to, near, adjoining or neighbouring it.

Goods and services tax

You may have GST obligations and entitlements if you sell with the intention of making a profit:

  • in the course of carrying on a business, or
  • as a business or commercial transaction.

If you’re unsure whether your subdivision falls into the above categories, consult with us.

Even with a one-off transaction, you may still be required to register for GST because your transaction may have the characteristics of a business deal/enterprise. Whether an enterprise is being carried on (and therefore whether you need to register for and charge GST) will depend on a range of factors.

If several of these factors are present it may be an indication that an enterprise is being carried on (as distinct from the land being sold as is):

  • there is a change of purpose for which the land is
  • additional land is acquired to be added to the original
    parcel of land
  • the parcel of land is brought into account as a business asset
  • there is a coherent plan for the subdivision of the land
  • there is a business organisation – for example a manager, office and letterhead
  • borrowed funds financed the acquisition or subdivision
  • interest on money borrowed to defray subdivisional costs was claimed as a business expense
  • there is a level of development of the land beyond that necessary to secure council approval for the subdivision and
  • buildings have been erected on the land.


Once registered for GST, you will:

  • need to include GST in the price of goods you sell, including land that you’ve subdivided
  • be able to claim credits for the GST included in the price of most of your business purchases (subject to the normal GST rules)
  • report these transactions by completing an activity statement.

If you are considering subdividing and selling, or even just selling vacant land, we can advise you of both the CGT and GST consequences.

If you sell any land separately from your home, it is invariably subject to CGT.


Hiring employees

With unemployment at historic lows, workers are in demand and are also switching jobs at record rates. There are a range of issues employers should be aware of when hiring.


Before hiring a new employee, make sure you know your rights and responsibilities. The minimum terms and conditions of employment come from an award, registered agreement and contract of employment, and also the National Employment Standards (NES). An employment contract or registered agreement can’t provide for less than what is in the NES.

To find the right award, and if an enterprise agreement applies, visit the Fair Work Commission website.


To work out the right pay when hiring a new employee, you need to decide on the person’s employment status – whether they will be a full-time, part-time or casual employee. Visit the Fair Work website or ask us for guidance.

On the Fair Work website, you can also locate the minimum pay rates, penalties and allowances that apply using their Pay and Conditions Tool.


It’s important that your employment contracts protect your business and your staff. To help you get things right, use the – Employment Contract Tool to create an employment contract that’s tailored to your business needs and complies with workplace laws.

To use this tool, your employee must be full-time, part-time or casual, covered by an award, paid an hourly or weekly wage. The Employment Contract Tool isn’t for every worker. It can’t be used for, employees who’ll be paid a salary, apprentices and trainees, seasonal workers, independent contractors, or employees covered by registered agreements.


Take the time to go through an induction with your new starter. Use this time to communicate your expectations and give them an opportunity to ask questions. It also helps employees feel informed, welcomed and prepared to do their job.


During the first few weeks of employment, employers and employees should organise a time to set goals and expectations. You can use this opportunity to outline training needs and create a plan together to ensure these needs are met.


Communication is an essential part of a good working relationship. Set up regular meetings to provide performance feedback and discuss any issues or concerns early, before they become workplace problems.


If you’re hiring an apprentice, use Fair Work’s Guide to taking on an apprentice to help you understand your obligations. You can also find more information on Fair Work’s Apprentices and trainees page.

These are just some of the issues to consider when hiring a new worker. If you have any questions around taxation, payroll, or whether the worker is a contractor or an employee, please contact us for assistance.


Super funds post lowest returns since GFC

Superannuation funds have recorded their worst performance since the global financial crisis, with the median balanced superannuation fund ending the 2021/22 financial year down 3.3% due to global market instability. This result is the third lowest return since the introduction of superannuation guarantee in 1992. So, what are your options if your superannuation balance has suffered a decline?

Sit tight and have faith

Although easier said, it is important not to panic about negative returns. Superannuation is a long- term investment, so if you are not approaching or in retirement, keep in mind that all market movements in the short-term can bounce back. Losses in superannuation are not crystalised until your superannuation is withdrawn or switched to another investment option. This means your superannuation balance will recover over the long-term if you sit tight and ride the market volatility wave.

Change superannuation funds

If you have a MySuper fund that is underperforming, you can use the ATO’s YourSuper comparison tool to help you compare different MySuper products and choose a superannuation fund that meets your needs. To recap, a MySuper fund is a low-cost superannuation product and is usually the default account for people who don’t choose their own superannuation fund when they start a new job.

The YourSuper comparison tool can be accessed by logging in to ATO online services through myGov, then clicking on the Super drop-down menu and select Information, then select YourSuper comparison.

There are other non-government superannuation comparison websites that can be used which provide some information for free, but some offer more information for a fee.

Seeking advice from a financial adviser will often be your best option as your entire circumstances will be taken into account to ensure the comparison information relates to your specific situation.

Start an SMSF

A further option may be to take charge of your own superannuation by setting up a self-managed superannuation fund (SMSF).

There are a number of benefits of having an SMSF, for example, as trustee you can choose how to invest and manage your superannuation savings. Having greater investment control and flexibility can allow you to have a more hands-on approach to acquiring and selling your investments, which means you can respond quickly by adjusting your investment portfolio as market conditions change. But for all the benefits that come along with SMSFs, you must consider the risks (and the work that may be involved) as there are strict laws and regulations that govern SMSFs.

Seek advice

A financial advisor can help review your superannuation to ensure that you are on the right track to meeting your retirement income goals. Contact us today if you are uncertain about your options and would like further information.


eInvoicing: Save time and money

The ATO is anticipating a significant upward spike in the number of businesses using eInvoicing over the coming 12 months. Already, more than 18,000 businesses are using eInvoicing to make their transactions faster, simpler and more secure.

eInvoicing is the new, standardised way to send and receive electronic invoices directly in software, via a secure network.

With eInvoicing, suppliers no longer need to print, post or email paper-based or PDF invoices and buyers won’t need to manually enter or scan invoices into their software.

ATO Deputy Commissioner Will Day says:

The pressures of running a business can often leave businesses with little time to focus on anything else. eInvoicing offers a streamlined way of managing invoices, allowing more time to focus on what is important to the business.

Once connected with eInvoicing, businesses can immediately transact with everyone on the same network, meaning you can be paid faster, and ultimately improve your cashflow.

With eInvoicing, you no longer need to manually enter or scan the invoices you receive, because that information is received directly through your accounting software, ready to be checked and paid.

Mr. Day said eInvoicing also reduces the risk of fake or compromised invoices and email billing scams.

With eInvoicing, the invoice is delivered directly into the customer’s software via a secure network, so there’s less risk of lost or fraudulent invoices being paid.

The Australian Small Business and Family Enterprise Ombudsman Bruce Billson said he enthusiastically encouraged small businesses to adopt eInvoicing.

It is a great way to enable faster payment, it cuts the administrative burden and is more secure than posted or emailed invoices, so it reduces the chance of invoice fraud or scams.

About 1.2 billion invoices are exchanged in Australia every year but many are sent to the wrong person or with incorrect information. It costs around $30 to process a paper invoice while an e-invoice costs less than $10.

Aside from cost savings, there are also fewer errors. An eInvoice is accurate and complete. eInvoicing uses standardised data that is validated before the eInvoice is sent through the network to your software.

With eInvoicing you don’t need to:

  • re-type or scan invoices
  • make corrections
  • chase missing information


This new system is also reliable and secure in that:

  • eInvoices are exchanged securely through the Peppol network by approved access points, using the buyer’s and supplier’s ABNs.
  • The risks of fake or compromised invoices, email scams and ransomware attacks are lower compared with posted or emailed invoices.
  • There is no risk of lost invoices.
  • You keep control of invoice processing.
  • This includes verifying and approving invoices. eInvoices can only be viewed by the supplier, buyer and digital software provider, where needed.
  • eInvoices do not go through the ATO and they cannot view them.

Businesses can get started with eInvoicing by registering in their software or talking to us. To find out if your software is eInvoicing enabled, we can check with your software provider.


Estate Planning Explained

Estate Planning means different things to different people. Ultimately, it is about ensuring that you have the right mechanisms in place to ensure that in the event of your death, your assets pass in the manner you intend.

Broadly speaking, there are four key steps in the estate planning process:

Firstly, identify which assets are to be dealt with as part of your estate plan? This can be more extensive than you think and could involve:

  • Savings accounts
  • Shares
  • Businesses
  • Properties
  • Vehicles
  • Collectibles
  • Items with sentimental value
  • Superannuation savings.

Next, who owns those assets? Assets can be owned individually, jointly, within superannuation, or by a related entity such as a company or trust.

Third, how do you want those assets distributed on your death? This a question only you can answer: who should get what and when?

Finally, how do you bring about this outcome? An estate plan brings together the answers to the above questions. It will usually include Wills and Powers of Attorney but in many cases will also involve succession planning strategies to deal with related entities and superannuation balances. Additionally, steps may also be necessary to provide for children and blended families.

Another key step is choosing your Executor. This is the person who will carry out your final wishes after you die. An Executor should be someone you trust who has some financial knowledge as they will be responsible for paying off debts and managing your Estate according to the terms set out in your Will. An Executor can be a family member, close friend, a lawyer, Public Trustee or other corporate provider.

Here are a few questions to help you decide whether you might have some gaps that need filling in your estate planning:

  • Do you have a Will?
  • If you do, when was it last updated?
  • Could you (or your spouse) locate your Will if you had to?
  • Do you have a Power of Attorney in place in case you were unable to make your own decisions?
  • If you and your spouse leave everything to one another in your Wills, have you considered what would happen in the event of your simultaneous death?
  • Do you realise that superannuation and family trusts don’t form part of your Estate and thus other strategies (besides a Will) are needed to properly deal with these?
  • Do you know that special, tax-effective structures known as Testamentary Trusts can be used to pass wealth securely to family members, but they are most effective when documented in your Will?
  • Have you properly considered who should be the Executor of your Will (sometimes the people closest to you, such as a spouse, may be in no fit state to play the role)?

Once in place, any good Estate plan should be reviewed and updated regularly. Major life events like marriages, divorces or deaths are a good opportunity to go back through your Estate plan and make sure the right people will be protected when you die.

Through a deep understanding of the personal and business structures of our clients, we are well positioned to help in the estate planning process, bringing about tax-effective outcomes tailored to the specific requirements at hand. Contact us for further information.

Insurance: Inside or outside super?

Most people insure their personal assets, such as their house, contents and car, but when it comes to personal insurance, many overlook the importance of protecting their wealth because personal insurance is often seen as unnecessary, a luxury and an additional cost to pay for.

Unfortunately, we don’t know what’s around the corner but having the right level of protection in place will assist you and your family through sickness and injury and protect you and your family’s lifestyle when times get tough.

Depending on your needs, insurance can be structured either inside or outside superannuation, with most superannuation funds offering insurance for their members.

Superannuation funds generally offer three types of life insurance for their members, including life insurance, total and permanent disablement (TPD) insurance and income protection insurance. This article briefly summarises these insurances and covers some common benefits and considerations when owning insurance in superannuation.


Life insurance, also known as death cover, is a lump sum amount paid to your beneficiaries on top of the balance that’s already in your superannuation account if you pass away. It may also be paid if you have a terminal illness.


Total and permanent disablement (or TPD) cover pays you a benefit if you become seriously disabled or are too sick to ever work again.

In addition to meeting the insurance policy definition of incapacity, you must also meet the permanent incapacity condition of release definition under superannuation law before the trustee can pay the TPD benefit to you.

Superannuation law defines permanent incapacity to mean:

“ill health (whether physical or mental), where the trustee is reasonably satisfied that the member is unlikely, because of the ill heath, to engage in gainful employment for which the member is reasonably qualified by education, training or experience”.

To be ‘reasonably satisfied’, a superannuation fund trustee will usually request medical evidence in the form of two doctors’ certificates to that effect. This is to also satisfy the requirement for the payment of a disability superannuation benefit.

It is also worth noting that the superannuation law definition of permanent incapacity is generally referred to as an ‘any occupation’ definition of permanent incapacity because it relates to gainful employment ‘for which the member is reasonably qualified by education, training or experience’.


Income protection (also called salary continuance insurance) helps replace your income if you can’t work due to a temporary disability or illness. If your claim is approved, your superannuation fund will pay you a regular income as a percentage of your salary for a specified period of time (ie, the benefit period could be for 2 years, 5 years or up to a certain age, such as age 65).


Trauma cover (also known as critical illness cover) pays you a lump sum amount if you are diagnosed with a critical illness or injury as specified in the policy, such as cancer, stroke, coronary bypass or heart attack. However due to changes in the law that came into effect on 1 July 2014, it is no longer possible to take out trauma insurance through your superannuation fund.


The key benefits of insurance inside superannuation include:

  • Premiums can be funded from your existing superannuation account balance, which can assist in managing your cashflow and affordability of premiums
  • You may benefit from income tax savings if you claim a tax deduction for personal contributions or if you contribute via a salary sacrifice arrangement using pre-tax salary which may provide cost savings on premiums
  • Insurance in employer superannuation plans may be cheaper than insurance outside superannuation as superannuation funds purchase insurance policies in bulk
  • After joining your employer’s default superannuation plan, you may be able to obtain automatic acceptance up to a set level of cover with no medicals required.

On the other hand, potential downsides of insurance inside superannuation include:

  • The amount of cover you can get inside superannuation is often lower than the cover you can get outside superannuation. Further, default insurance through superannuation isn’t specific to your circumstances and some eligibility requirements may apply. To avoid this risk, you can purchase a retail insurance policy through superannuation (or personally outside of superannuation). While retail cover requires a more detailed application process, underwriting your personal history and generally higher premiums than default group cover, retail cover can provide you with better quality cover and greater confidence that a payment is likely to be made at claim time
  • Premiums can erode your retirement savings if you do not make extra contributions to negate the premium cost
  • Contributions made to fund premiums count towards the contribution caps
  • If you consolidate your superannuation accounts, you may lose any cover you have with the superannuation fund you close. Thus, you should always check that the new superannuation fund you’re choosing can cover you for equivalent (or more) insurance cover
  • Unless you actively opt-in to maintain your insurance, your cover may be cancelled if your superannuation fund becomes inactive for 16 months or more, the fund balance falls below $6,000 or you are under age 25.


Wealth protection is considered to be the foundation of all good wealth creation plans, because without it, even the best laid wealth creation plans can go awry. Insurance is all about having peace of mind, so plan for tomorrow by obtaining advice on whether you need insurance cover and if so, the types of personal insurances you may need and how to best structure the cover.


Click to view our Glance Consultants September newsletter in PDF

SUBSCRIBE to the Business Accelerator Magazine