How your super is taxed

Concessional contributions cap

Generally, you can make up to $27,500 worth of before-tax contributions each year. Anything over this will be taxed at your income tax rate (less a 15% tax offset).

If you exceed the cap, you’ll have to decide to either:

• withdraw up to 85% of your excess contribution amount or
• leave the excess in your super where it will count towards your after-tax contributions cap.

Carry forward unused contributions

You can carry forward any unused amount of your concessional contributions cap if:

• you have a total superannuation balance of less than $500,000 at the end of the previous financial year and
• you meet the usual eligibility criteria for before-tax contributions.

All details are in our Opportunities and limits for super contributions fact sheet.

Claiming a tax deduction

As long as you keep under the concessional contributions cap, you can claim a tax deduction on personal contributions you make to super. This will effectively convert your contribution from after-tax to before-tax. You'll need to complete a Notice of intent to claim a deduction for personal super contributions form and send it to us. Once we've processed it, you can claim the deduction in your tax return.

Non-concessional contributions cap

The limits on after-tax contributions (if your total super balance at the previous 30 June was more than $1.7 million) are:

• $110,000 per financial year or
• $330,000 over a 3-year rolling period if you're under age 67 or
• nil if your total super balance at the previous 30 June was more than $1.7 million.

If you exceed the cap, you can choose to:

• withdraw the excess from super, along with 85% of the associated earnings (this money will be taxed at your income tax rate, less a 15% tax offset) or
• leave it in super where it will be taxed at 47% (including Medicare levy).

Accumulation account: The taxable component is taxed at the lower of 20% (plus Medicare levy) or your marginal tax rate.

Transition to retirement account: The taxable component is taxed at your marginal tax rate with no tax offset.

Income account: The taxable component is taxed at your marginal tax rate with no tax offset.

Accumulation account: No tax applies on the first $225,000² of your taxable component. Anything over that is taxed at the lower of:

• 15% (plus Medicare levy)
• your marginal tax rate.

Transition to retirement account: Generally, your marginal tax rate is applied to your taxable component, less a 15% tax offset.

Income account: The taxable component of your income payments will be taxed at your marginal rate, with a 15% offset. For lump sum withdrawals, you won’t pay tax on the first $225,000² of your taxable component. Anything over that will be taxed at 15%.

The taxable component is taxed at your marginal tax rate with a 30% tax offset. First home super saver payments can be paid to eligible Accumulation account members only, as determined by the Australian Tax Office (ATO).

These are payments made to foreign nationals leaving Australia permanently. Applications are submitted to and assessed by the ATO. The taxable component of this payment will be taxed up to 65% and deducted before payment.

Accumulation account: Generally, no tax will apply.

Transition to Retirement or Income account: No tax applies if the benefit is paid as a lump sum. If the death benefit is paid as an income stream, the tax applicable is:

• nil if you are over age 60
• nil if your dependant is over age 60 or
• if you and your dependant are under age 60:
  • nil for the tax-free component
  • the dependant’s marginal tax rate with a 15% rebate on the taxable component.

For all account types, no tax is payable on the tax-free component. The lower of your marginal tax rate or 15% (plus the Medicare levy) will apply to the taxable component.

For all account types, tax is payable based on the classification of the beneficiaries. The estate will be required to pay any applicable tax.