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Understanding Super Contributions

Superannuation can be boring and complex but it is one of my all time favourite topics (yes I know, I need to get a life!!). And whilst you might think that super contributions are straightforward, there are a few things you need to know.

Super contributions typically fall into two categories being concessional contributions (think pre-tax) and non-concessional contributions (think post tax).

1. Concessional contributions include
  • Compulsory SG contributions which are the before-tax contributions your employer is required to make into your super fund under the super guarantee, if you’re eligible.

  • Salary Sacrifice contributions, which are additional contributions you can get your employer to make into your super fund out of your before-tax income, if you choose to.

  • Tax Deductible contributions which are voluntary contributions you can make that you then claim a tax deduction for. These can be made by self-employed people and employees, and in some cases by those who aren’t working or who have retired (warning: this is where you need to seek advice, to ensure that it is suitable for you)

Note, concessional contributions are usually taxed at 15% in your super fund (or 30% if your total income exceeds $250,000), which for most people, means you’ll typically pay less tax on super contributions than what you do on your income.

2. Non-concessional contributions include
  • Personal contributions, which you can also make by transferring funds from your bank account into super, but which you can’t claim a tax deduction for. Some people may choose to make non-concessional contributions when they’ve reached their yearly concessional contribution cap, following an inheritance or sale of a large asset, or to receive a government co-contribution.

Cap limits apply to contributions

If you’re making contributions to your super, there are limits on the amount of concessional and non-concessional contributions you can make each year. See below how much you can put in annually.

Contribution type

Your age




$27,500 a year

Plus, unused cap amounts accrued since 1 July 2018 if you’re eligible*


Under 75

$110,000 a year

Alternatively, up to three years of annual caps ($330,000) under bring-forward rules if you’re eligible**

* This broadly applies to people whose total super balance was less than $500,000 on 30 June of the previous financial year.

** How much you can make as a non-concessional contribution depends on your total super balance as at 30 June of the previous financial year.

For those of us working, our income can vary from year to year and this is why it’s important to review your contributions each year. Planning can involve maximising contributions and in some cases, holding off to meet future strategies, so seek advice.

General Advice Warning - This communication has been prepared on a general advice basis only. The information has not been prepared to take into account your specific objectives, needs and financial situation. The information may not be appropriate to your individual needs and you should seek advice from your financial or tax adviser before making any investment decisions.


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