Disclaimer
The results obtained from these calculators are for general purposes only to illustrate the effect of compound interest and are not intended as a substitute for professional financial advice. Before making any financial decisions on the basis of these results, you will need to consult with an independent financial planner or accountant as well as consider whether the advice is suitable to meet your personal financial objectives and circumstances.
The actual performance of any investments will depend on future economic conditions, investment management, fees and taxation. Past performance is no guarantee of future performance and as a result of this, all the results are hypothetical and are NOT GUARANTEED.
Nambawan Super specifically disclaims any liability for any direct, indirect, incidental, consequential or special damages arising out of or in any way connected with the access to or use of these calculators. To the extent permitted by law, under no circumstances will Nambawan Super be liable for any loss or damage caused by a user's reliance on the information by using these calculators.
Assumptions
Projected super balance at retirement:
The projected total super balance takes into account your starting balance, employee and employer contributions, any additional voluntary contributions as well as interest earned between now and your retirement.
Retirement age:
We have assumed a default retirement age of 65. This can be adjusted in the calculator.
Working life:
The calculator assumes that you will have a continuous working life with no breaks up to your retirement age.
Interest rate:
The default investment returns have been set at 6.0%. This is based on the Nambawan Super 10-year average interest rate.
Employee contributions:
PNG Superannuation laws dictate that 6% is the mandatory minimum contribution for employees to make. Employees may choose to contribute more than the minimum.
Employer contributions:
PNG Superannuation laws dictate that 8.4% is the mandatory minimum contribution that employers have to make. Employers may choose to contribute more than the minimum.
Superannuation, like most other industries, is subject to the tax laws of Papua New Guinea. Understanding when and how this tax affects your Super is important to making the right decisions for your best retirement outcome.
What gets taxed and when?
Your Employer's and Employee contribution percentages are calculated on your salary amount, but your employee contribution is deducted on the after tax. You can read more on how superannuation contributions work with your salary and wages tax on the Internal Revenue Commission (IRC)'s website, and read more on the marginal rates here.
While your Superannuation savings are with the Fund, the potential interest that can be earned and applied from the Fund's strategic investments is affected due to tax applied to the profits of its investments. While this does not directly affect your Member and Employer contributions that are with the Fund, the tax does affect the amount of crediting interest that is applied to the Member and Employer contribution balance.
Upon exiting the Fund, under Section 46B of the Income Tax Act 1959, tax is to be applied to all Member benefit payments at the time of exit. Tax is applied only on the Employer and interest component of Members' Super balances. The Member contribution component is not taxed.
How much gets taxed?
The table below provides details on how tax is applied to the Employer contributions, any interest credited when a Member exits, and how this changes with the number of years of contribution or the Member's situation:
| Years of contribution or situation | Rate of Tax applied to Employer contributions and Interest |
| Less than 5 years | Marginal rate of Tax |
| Greater than 5 years but less than 9 years | The lesser of 15% OR the marginal tax rate |
| Greater than 9 years but less than 15 years |
The lesser of 8% or the marginal tax rate |
|
Greater than 15 years, Or under the following circumstances:
|
2% tax |
In short, the more years a Member contributes, the less tax they will have to pay when they exit the Fund.
To read more on the tax rates and legislation, you can visit the IRC website.
