Concessional Superannuation Contributions: Who Qualifies and What You Get
Learn how to pay lower tax on your superannuation contributions and understand the limits of this tax incentive.
Concessional superannuation contributions allow you to put money into your retirement fund at a lower tax rate than your normal income tax.
Who it's for
This scheme is available to all working Australians who are under the age of 75.
What you get
When you make these contributions, the money is taxed at a flat rate of 15% inside your super fund. This is usually significantly lower than the top marginal tax rates applied to your standard income.
What it costs you
There is a limit to how much you can contribute each year under this specific tax rate. For the 2024/25 period, there is an annual cap of $30,000. This limit applies to the total amount of concessional contributions you make within that timeframe.
The catch to know
You must be careful not to exceed your annual limit. If your total contributions go over the cap, you may face an excess contributions tax, which is calculated at your personal marginal tax rate.
How to apply
- Discuss contribution methods, such as salary sacrifice, with your employer or fund.
- Monitor your total contributions to ensure you do not exceed the yearly cap.
- Check your official statements to track your progress against the limit.