Give your super a helping hand

Salary Sacrifice

You can arrange for your employer to increase the regular amount put into super from your pay packet before tax is taken out. This method, known as salary sacrificing, may lower your taxable income – allowing you to pay less tax.

In addition, any super top-up that you make in this way will likely be taxed at the concessional rate of 15%. While it will depend on your actual level of income, this can usually be lower than most people’s personal income tax rate making it a tax effective way to boost your super. 

If you’re in a financial position to salary sacrifice, it’s often a good idea to organise this before the start of a new financial year.  

Government Co-Contribution

The Government Co-contribution is designed to help low and middle-income earners boost their super balances for retirement. If you can contribute at least $1,000 after tax into your fund within the 2023-24 financial period, and earn an income between $43,445 and $58,445, you may be eligible for the Co-contribution from the government that can be paid at any time into your super fund. The maximum amount that you can receive is $500.

For the 2024-25 financial year, you need to earn between $45,400 and $60,400 to be eligible to receive a Co-contribution amount.   

To find out if you are eligible to receive a Co-contribution amount, visit the ATO website and use the Super Co-contribution calculator.

Make a downsizer contribution 

If you’re 55 years or older and selling your main residence, you may be able to contribute up to $300,000 into your super using the money from the sale. This is particularly handy if you haven’t had the chance to save enough funds for retirement.

You can do this regardless of your work status, super balance or contributions history. It’s not subject to any work test, upper age limit or other contribution cap, but it may count towards your transfer balance cap. This cap is applicable when you move your super balance from accumulation/super savings into retirement phase. Even better, both you and your spouse can take advantage, meaning you may be able to contribute up to $600,000 as a couple.

To make a downsizer contribution, you must meet the following requirements:

•    You or your spouse have owned the home for at least 10 years before the sale
•    The home is in Australia and is or would be exempt or partially exempt from capital gains tax under the main residence exemption
•    The home is not a caravan, houseboat or any other mobile home
•    You must make this contribution into your super fund within 90 days of receiving the proceeds of sale (usually settlement date) and
•    You have not made a downsizer contribution before.

To read more about this type of contribution refer to the ATO website.

To make this contribution, complete the Downsizer contribution form.

Spouse contributions 

You may be eligible for a tax offset for a contribution made on behalf of your spouse if:

•    Your spouse (receiving the contribution) is under the age of 75
•    You and your spouses are Australian residents
•    A contribution of at least $3,000 needs to be contributed into the spouse’s account in order to qualify for the full amount of the tax offset (i.e. $540)
•    The annual income¹ of your spouse (receiving this contribution) is less than $40,000

You may be eligible for a tax offset of up to $540.

To read more about this type of contribution refer to the ATO website.

_{(1) Broadly, annual income for these purposes is calculated as the sum of the spouse’s assessable income, total reportable fringe benefit amounts and total reportable employer super contributions.}

Other caps and thresholds you should know

•    If you have a total super balance of $1.9 million or more as at 30 June of the previous financial year, you can’t make any non-concessional contributions.
•    Your total super balance will need to be below $1.68 million as at 30 June of the previous financial year, to contribute up to three years of annual caps ($330,000) under the bring-forward rule.
•    From 1 July 2023, the amount of super savings that can be transferred into a retirement pension has increased from $1.7 million to $1.9 million, but not for everyone.

Superannuation changes effective from 1 July 2024

•    Concessional contributions will increase from $27,500 to $30,000 for the 2024-25 financial year.
•    The cap for non-concessional contributions will increase to $120,000 for the 2024-25 financial year. Therefore, if you’re under the age of 75 and eligible, you may be able to contribute at least $360,000 fir the 2024-25 financial year.

Accessing your super

When you make super contributions, it’s important to understand that you can only access your super under certain rules, largely known as the conditions of release. For most people, this is when they:   

•    Reach their preservation age and retire, which varies between 55 and 60, depending on what year you were born.
•    Reach preservation age and choose to begin a transition to retirement income stream while still working.
•    Reach age 60 and cease an employment arrangement, or
•    are 65 years old (even if you have not retired).

However, you might be able to access super earlier in some special circumstances. These include permanent incapacity, severe financial hardship, compassionate grounds or if you have a terminal medical condition. Visit the Maturities and Withdrawals page for more information.

We're here to help

Superannuation can be a complex area to navigate. Remember also that the value of your investment in super can go up and down depending on where your savings are invested and market conditions. Before making any contributions, make sure you understand and are comfortable with any potential risks. 

To find out more:

•    Contact us online
•    Contact your financial adviser or tax agent
•    Learn how to find your missing super accounts 
•    For additional resources and the Government superannuation calculator visit Moneysmart