Dylan (57) and Megan (56) are considering retiring in the next few years. They have some questions for you since you are their adviser.

They own their own home outright and have two children, Rob (19) and Con (23). Rob is a full-time university student, and Con works in a bank.

Dylan is employed as a surveyor and earns a salary of $100,000p.a. + 9.5% Superannuation guarantee charge. He has $700,000 in his superannuation account, with $200,000 in the Tax-Free component and $500,000 in the Taxable component. Dylans superannuation account has a binding death nomination, split 50% to Megan, and 25% each to Rob and Con.

Megan is a self-employed freelance journalist and earns $35,000 p.a.

She has not made any contributions to her superannuation account since starting her business 5 years ago. From her previous employment, she has a superannuation account which has $200,000 in it, made up of $160,000 Taxable (Taxed) and $40,000 Tax-Free components. Megan has not nominated any beneficiaries in respect of her superannuation account.

QUESTION 3 Dylan and Megan have heard about a strategy called Transition to Retirement (TTR) and they would like to know more. REQUIRED:

(a) Dylans superannuation balance was $650,000 as at 30 June 2019. He has $15,000 unused concessional cap contributions in the financial year 2019. Explain whether Dylan is entitled to use the used concessional cap contribution of $15,000 in the financial year 2020?

(b) Calculate the maximum amount that Dylan can Salary Sacrifice in the financial year 2020. Show your calculations.

(c) Assume Dylan has decided to salary sacrifice $15,000 of his salary to superannuation, in addition to his $10,000 Superannuation Guarantee contributions. He will draw a TTR pension of $30,000 to supplement the income from his salary. Prepare a table that shows Dylans position before and after the TTR strategy, also include the Medicare levy. Show your calculations.