Important super changes

What

Current rules

New rules from 1 July 2017

Caps on before-tax (concessional) contributions

This includes the 9.5% of salary your employer pays into your super.

• $30,000 per year if you’re under age 49 on 30 June 2016, and
• $35,000 per year if you’re age 49 or over on 30 June 2016.

Cap on after-tax (non-concessional) contributions

These are additional amounts paid to super from after-tax money.

• $180,000 per year, or

• $540,000 over a three-year period (If you’re under age 65).

If you are over 65, you must meet the work test before you are eligible to make any after-tax contributions.

• $100,000 per year, or

• $300,000 over a three-year period (If you’re under age 65)¹,

unless you have a super balance over $1.6 million, then you can’t make any after-tax contributions.

If you are over 65, you must still meet the work test before you are eligible to make any after-tax contributions.

Cap on transfers to pension

Limit to the amount of money you can transfer from super into a pension account.

No limit.

Limit of $1.6 million. Any amount above this can be left in super or taken from the super system (as long as you meet a condition of release).

Extra tax for high income earners

Before-tax super contributions are taxed at 30% for high income earners, instead of 15%.

Applies if you earn $300,000 per year or more.

Applies if you earn $250,000 per year or more.

Tax offset for low income earners

If you earn less than $37k per year, tax on super contributions is repaid to your super (up to $500 per year).

Called the Low Income Superannuation Contribution (LISC).

Called the Low Income Superannuation Tax Offset (LISTO).

Personal payments to super

A tax deduction for payments you make to super up to the annual concessional cap.

You are eligible if you earn less than 10% of your income from salary or wages.

Anyone under age 75 is eligible. If you’re between 65 and 74, you’ll need to meet the work test to be eligible.

Anti-detriment payments

When a lump sum death benefit is paid to a dependant, they may receive a refund of the 15% contributions tax that the deceased member paid over their lifetime.

Eligible dependants receive the anti-detriment payment when a death benefit is paid to them.

No anti-detriment payments.

Spouse contribution offset

If you make contributions to your spouse’s super, you can get an offset of up to $540 per year.

Available if your spouse earns less than $10,800 per year.

Please note: You may be eligible for a reduced amount if your spouse earns less than $13,800.

Available if your spouse earns less than $40,000 per year.

Tax on investment earnings in transition to retirement accounts

This is the tax you pay on earnings from money invested in a transition to retirement account.

You pay no tax on earnings in a Transition to Retirement account regardless of your age.

You’ll pay 15% tax on investment earnings in your Transition to Retirement account.

‘Catch up’ before-tax contributions

You can carry forward your unused before-tax cap amount (for up to 5 years) and make extra before-tax contributions up to combined limit (current cap plus unused caps from previous years).