How your super is taxed

Get to know how tax relates to your super and how you can minimise it. 

The ways your super can be taxed

Most of us will pay less tax on money we put into super. And if you access your super after age 60, you’ll pay no tax on your super at all.

Your super can be taxed in four different ways:

  1. When you make a before tax contribution
  2. If you make after-tax contributions beyond certain limits
  3. On investment earnings
  4. When you withdraw super 

Before tax contributions also have limits set by the Government on how much you can add to your super account. If you contribute above these limits, you may pay extra tax.

Your Tax File Number – the key to paying less tax

Since super can be a tax effective way to invest and save for retirement, remember the following golden rule. If you’re a member, and you haven’t given us your Tax File Number (TFN), you’ll pay more tax – up to 47%* on your before-tax and your employer’s SG contributions.

Super funds can’t accept any after-tax contributions if you haven’t provided your TFN.

Supply my TFN online https://www.australiansuper.com/tools-and-resources/forms-and-publications/tfn-collection-form.aspx

* Includes the Medicare levy.

Tax on before tax contributions

Before tax contributions are mainly employer contributions, salary sacrifice contributions and personal contributions claimed as a tax deduction. They’re taxed at a rate of 15% if you earn less than $250,000 a year, and 30% if you earn more than $250,000 a year.

  • Limits and details

    • A $25,000 limit applies to contributions made from your before tax income

    • Any amounts over the $25,000 limit will be taxed at your marginal tax rate plus Medicare levy, minus a tax offset of 15% (because you’ve already paid tax on this money), plus an interest charge

    • You can choose to withdraw up to 85% of excess contributions, which won’t count towards your after-tax limit, but will be taxed at your marginal tax rate plus Medicare levy, plus an interest charge

    • Any excess before-tax contributions not released count towards your after-tax contributions cap.

Tax on after-tax contributions

After-tax contributions are typically extra, voluntary contributions you make with your take-home pay, including contributions for your partner or perhaps when you sell a house or receive a bonus. You must give us your Tax File Number (TFN) before we can accept after-tax contributions.

  • Limits and details

    • If you have $1.6m or more in your super account, you can’t make after-tax contributions

    • A $100,000 limit applies to contributions made from after-tax sources. No tax is payable on amounts up to $100,000 a year (or $300,000 over three years if certain conditions are met. The three-year period automatically starts from the first year that you add more than $100,000 after tax to your super)

    • Any amounts over this limit will be taxed at 47% (includes Medicare levy), unless you ask your fund to release the amounts that are over the limit

    • The associated earnings withdrawn are taxed at your marginal tax rate. You will also be entitled to a 15% non-refundable tax offset of the associated earnings included in your assessable income

    • If you choose not to withdraw your excess after-tax contributions, they will remain in your super account and the excess will be taxed at 47% (includes Medicare levy).

Tax on investment earnings

Your investment earnings are taxed at a rate of up to 15%.

  • Details

    • Tax is deducted from investment earnings (along with investment management fees) before the crediting rate is determined

    • No tax is deducted from the crediting rates of Choice Income members, unless members are using a Transition to Retirement strategy, in which case up to 15% tax applies.

Tax on withdrawals

Any withdrawals you make are divided into a tax-free and a taxable component, which are calculated from the type of contributions that have been made to your account

To find out how much is tax-free and how much is taxable, you can get a benefit quote from your online account, or call us on 1300 300 273.

  • Details

    • Tax is deducted from investment earnings (along with investment management fees) before the crediting rate is determined

    • No tax is deducted from the crediting rates of Choice Income members, unless members are using a Transition to Retirement strategy, in which case up to 15% tax applies.

Tax deductions – are you eligible?

All members are able to claim a tax deduction for personal contributions.  To do this, you’ll need to lodge a Notice of intent to claim a tax deduction for personal super contributions form. This tells us the amount you want to claim. We’ll write back confirming the amount. A 15% contributions tax will then be deducted from your contributions and reported on your next member statement. From there you can submit your tax return stating the amount you want to claim as a tax deduction in the supplementary section of your tax return.

  • Eligibility criteria

    • You have not opened a retirement income account using part or all of the contributions for which you intend to claim a tax deduction and

    • You’re a member of AustralianSuper and your contributions are still in your super account and;

    • You’re planning to split all or part of your contributions with your partner but you also want to claim a tax deduction for them, you must give us the notice of intent to claim a deduction first.

  • Limits on what you can claim

    You can't claim a tax deduction for: 

    • super you transfer from one fund to another (including an overseas super fund)
    • contributions you split with your spouse, or 
    • super contributions you transfer to start a retirement income account.

         If you're 75 or older, you can't claim a deduction for contributions that were made          more than 28 days after the month you turned 75.
         If you're under 18 at the end of the income year, you can only claim a deduction if          you earned income as an employee or business operator during the year you want        to claim the deduction. Those aged 65 to 74 will still need to meet the work test in          order to be eligible to make a contribution and claim a tax deduction


Claiming a tax deduction for personal contributions - pdf, 123KB

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