For many people affected by the Shield Master Fund situation, the money paid into their Macquarie CMA has created a confusing question:
“What do I do with it now?”

In the earlier article, I explained that Macquarie returned 100% of the original Shield investment amount to affected Macquarie members, less any withdrawals, but not always entirely back into super. In many cases, a portion was returned to super and another was paid into a Cash Management Account in the person’s own name.
That detail matters.

Once money is sitting in a CMA in your personal name, it is no longer considered to be inside the super environment. That may create tax questions, but it may also create planning opportunities. The first article explained the broader issue. This one looks at one specific idea:

Using a tax refund strategically, rather than treating it as a one-off bonus.
Where someone is eligible, one strategy people often consider is making a personal deductible contribution into super before 30 June.
The ATO states that personal super contributions may be deductible if they are made to an eligible fund, and the person gives the fund a valid notice of intent to claim the deduction. The general concessional contributions cap is currently $30,000, although some people may have unused concessional cap amounts available from prior years if they meet the carry-forward rules. Note: you must check this first before doing anything.

If a person contributes money to super and claims a valid deduction, the contribution is generally taxed in the super fund at 15%, instead of being taxed at the person’s marginal tax rate. The ATO confirms concessional contributions are taxed in super at 15%.
That can create a tax refund. The more interesting part is what happens next.
Instead of spending the refund, the refund can potentially be reused. For example, it may be placed into an offset account, used to reduce debt, or even used as a further super contribution in the following financial year if appropriate.
This is where the same dollar can sometimes work more than once.

Many people treat a tax refund like a bonus. But in this situation, the refund may be part of a bigger recovery strategy.
For people impacted by Shield, re-contributing some of the CMA money, where appropriate, may help restore part of the retirement balance. Reusing the refund may then help improve cash flow, reduce interest, or create another round of savings.
That does not mean everyone should do it.
It depends on:
• income level,
• tax position,
• available concessional contribution cap,
• super balance,
• age and contribution eligibility,
• cash flow needs,
• mortgage or debt position,
• whether the money may be needed for tax or other future costs, or
• whether a valid notice of intent can be lodged and acknowledged before the tax return is completed.

You must speak carefully assess your overall situation (or speak to a professional) before you start moving money around.

The important warning

This is not a guaranteed strategy and it is not suitable for everyone.
It is also important not to accidentally exceed contribution caps. If unused concessional cap amounts are being used, the ATO says carry-forward concessional contributions are generally available only where the person’s total super balance was less than $500,000 at the previous 30 June.

Timing also matters. For a contribution to count in a financial year, it generally needs to be received by the super fund by 30 June, not merely intended or transferred late.

The takeaway

The Macquarie CMA payment created confusion, but for some people it may also create an opportunity. The real opportunity is not simply receiving a refund. It is what you do with the refund next.
sed carefully, the same money may help rebuild super, reduce tax, lower interest, and improve a person’s overall position over time. Used poorly, it may simply sit in a CMA earning modest interest, or disappear into spending without any longer-term benefit.
This is general information only. It does not take into account your objectives, financial situation or needs. Before acting, you should consider whether the information is appropriate to your circumstances.