Tax and super
Generally, there are three stages where your super might be taxed:
- Investment earnings
- Withdrawing a benefit
Tax on contributions
Before-tax (concessional) contributions
These contributions are taxed at 15% when they’re paid into your super account, as long as you haven’t exceeded your annual contribution cap. The before-tax contribution cap is $25,000 regardless of your age.
After-tax (non-concessional) contributions
These contributions are generally not subject to any tax as they come from an after-tax income which has already been taxed. The cap on the amount of after-tax contributions you can make is $100,000 per year for everyone. If you’re under 65, you can contribute up to $100,000 per financial year, or up to $300,000 over a three year period.
If you exceed either the before or after tax cap, there are additional tax consequences.
Tax on investment earnings
Up to 15% tax is payable on investment earnings. This tax is deducted from investment earnings before they are applied to your account.
Tax on withdrawal benefits
The amount of tax on payments from super can depend on your age, the amount of your payment and the reason for your payment.
For more information on how your super is taxed, read the Your Super Guide.
Your Tax File Number – the key to paying less tax
If you don’t provide us with your Tax File Number (TFN), you’ll pay more tax – up to 45% (including the Medicare Levy and any relevant Government levies) on your before-tax contributions. Also, we won’t be able to accept any after-tax contributions from you.
Contributions tax for high income earners
Members who earn over $300,000 a year may pay 30% tax on some or all of their before-tax contributions.
If your income is less than $300,000 a year, but is more than $300,000 when you include your before-tax contributions, the 30% tax rate will apply to the part of your before-tax contributions that take you over the $300,000 threshold.
For example if your income is $290,000 and your before-tax contributions are $15,000, you only pay the 30% tax rate on $5,000.