Understanding the recent changes to super tax concessions

What the $3 million super threshold means for retirement planning 

Super remains one of the most effective ways for Australians to save for retirement. However, recent changes to super tax concessions are a reminder that retirement rules can evolve over time.

From 1 July 2026, new rules introduced under Division 296 of the Income Tax Assessment Act 1997 (ITAA 1997) apply additional tax on certain earnings attributable to the portion of an individual's total super balance above $3 million. Rather than applying separately to each fund, this threshold is assessed at an individual level across all super accounts. 
 

Building a resilient retirement strategy

While Division 296 will only impact those with total super balances exceeding $3 million, this change does highlight that the tax treatment of super may differ as balances grow. For those building significant retirement savings, it may be worth considering: 

• how your wealth is structured across different assets
• whether future legislative or regulatory changes could affect your financial position, and  
• if your overall retirement strategy continues to meet your long-term objectives.

For many Australians, a strong retirement strategy extends beyond super alone and may include a combination of:

• super savings
• personal investments and savings
• appropriate insurance and protection strategies, and
• other sources of retirement income.

Having a diversified mix of assets and income sources can provide greater flexibility and confidence, enabling you to adapt as your circumstances and objectives change and the regulatory environment evolves.
 

Keeping your future on track 

For most Australians, superannuation will remain a highly effective retirement savings vehicle. However, the new rules highlight the importance of considering super as just one part of a broader retirement strategy that takes into account flexibility, tax outcomes, and long-term financial goals. Regular reviews can help ensure your retirement strategy remains both appropriate to your circumstances and aligned with your financial objectives.