Are you considering contributing extra to your superannuation in the 2023-24 financial year? Below is a summary of the key thresholds and caps that you will need to know.
Superannuation guarantee contribution:
The rate of SGC super that your employer needs to pay from 1 July 2023 to 30 June 24 is 11%.
The rate will increase over the next couple of years:
2024 - 2025 11.5%
2025 - 2026 12%
2026 - 2027 12%
Maximum superannuation contribution base:
The maximum superannuation contribution base is used to determine annual limits on contributions. Employers do not have to provide the SGC minimum support for the portion of earnings above the limit, which in 2023-24 = earnings of $62,270 per quarter
Contribution caps:
Each year there is a limit on the concessional superannuation contributions, that is the superannuation contributions that are taxed at the concessional rate of only 15%. All superannuation contributions made above the cap are taxed at a higher rate.
Concessional contributions are:
- Employer contribution (including salary sacrifice super)
- Personal contributions claimed as a tax deduction
In the 2023-24 financial year, the contributions cap is $27,500 for all ages. Any contributions above $27,500 will be taxed at your marginal tax rate.
Superannuation co-contributions:
The government may add to your super if you are eligible for the super co-contribution.
You don't need to apply for the government contributions. If you're eligible and your fund has your tax file number (TFN), the government will pay it directly into your super automatically.
The super co-contribution is designed to assist eligible individuals with saving for retirement. If you are eligible and make personal super contributions during a financial year, the government will pay a super co-contribution up to certain limits.
2023-24:
Maximum entitlement $500
Lower income threshold $43,445
Higher income threshold $58,445
The co-contribution is $500 for incomes up to the lower threshold and declines until it phases to nil after the higher income threshold.
Potential changes to superannuation:
On 2nd May 2023 the Australian Government announced that from 1 July 2026, employers will be required to pay their employees’ super at the same time as their salary and wages ("Payday Super").
The start date is aimed at providing employers, super funds and payroll providers with sufficient time to prepare for the change. This measure is not law as yet, but we will keep you up to date as it progresses.
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