How to Make Contributions to Your Super

Australia’s superannuation system, or “super,” is a mandatory long-term savings program designed to build financial security for retirement. Contributions are regularly made into a dedicated fund and invested to provide income during retirement. This system is a core component of Australia’s retirement income framework, complementing the government-funded Age Pension and voluntary personal savings. Greater contributions during working years can lead to a more comfortable retirement.

Types of Super Contributions

Various avenues exist for contributions to be made into an Australian superannuation fund, each serving a distinct purpose in building retirement savings.

Employer contributions, known as the Superannuation Guarantee (SG), are compulsory payments made by employers into an employee’s super fund. From July 1, 2025, the Superannuation Guarantee rate is 12% of an employee’s ordinary time earnings. This mandatory contribution forms the foundation of many individuals’ retirement savings.

Salary sacrifice contributions involve an arrangement with an employer where a portion of an employee’s pre-tax salary is directed into their super fund. This strategy can reduce an individual’s taxable income because the sacrificed amount is contributed to super before income tax is applied. These contributions are considered concessional.

Personal contributions are made directly by an individual into their super fund from their after-tax income or savings. These can be categorized into two types: those for which a tax deduction is claimed (concessional) and those for which no deduction is claimed (non-concessional).

Spouse contributions occur when an individual contributes money into their spouse’s super fund from their after-tax income. This can be a strategic way to boost a lower-earning spouse’s retirement savings, and the contributing spouse may be eligible for a tax offset. These contributions are treated as non-concessional for the receiving spouse.

Government co-contributions are matching payments made by the Australian government to eligible low-income earners who make personal after-tax contributions to their super. The government matches a portion of the personal contribution, up to a maximum amount.

Downsizer contributions allow eligible individuals aged 55 or older to contribute up to $300,000 from the proceeds of selling their home into their super fund. For couples, this can mean a combined contribution of up to $600,000. These contributions do not count towards an individual’s concessional or non-concessional contribution caps and are not subject to a total superannuation balance limit.

Understanding Contribution Limits

The Australian superannuation system imposes annual caps, or limits, on the amounts that can be contributed to super without incurring additional tax.

Concessional contributions, which include employer Superannuation Guarantee payments, salary sacrifice contributions, and personal contributions for which a tax deduction is claimed, have an annual cap. For the 2025-2026 financial year, the general concessional contributions cap is $30,000. All these before-tax contributions are combined when determining if an individual has exceeded this cap.

Non-concessional contributions, which are made from after-tax income and generally do not attract a tax deduction, also have an annual cap. For the 2025-2026 financial year, the non-concessional contributions cap is $120,000. Individuals may be able to utilize a “bring-forward” rule, allowing them to make larger non-concessional contributions by accessing future years’ caps. This rule can permit contributions of up to $360,000 over a three-year period, depending on their total super balance.

Individuals with a total superannuation balance below a certain threshold may be able to use unused portions of their concessional cap from previous financial years. This is known as the “carry-forward” concessional contributions rule. To be eligible, an individual’s total superannuation balance must have been less than $500,000 on June 30 of the previous financial year. Unused cap amounts can be carried forward for up to five financial years before they expire.

Exceeding these contribution caps can result in additional tax liabilities. For example, excess concessional contributions are generally taxed at an individual’s marginal tax rate, in addition to the 15% contributions tax already applied by the super fund. Excess non-concessional contributions may also incur additional tax. The Australian Taxation Office (ATO) manages the assessment of these excess contributions.

Tax Implications of Contributions

Superannuation contributions are subject to specific tax rules that influence the net amount received by the fund and the ultimate benefit to the individual.

Concessional contributions, including employer Superannuation Guarantee payments, salary sacrifice amounts, and personal deductible contributions, are generally taxed at a flat rate of 15% when they are received by the super fund. This is often referred to as contributions tax. For high-income earners, an additional tax, known as Division 293 tax, may apply. This tax applies an extra 15% tax on concessional contributions for individuals whose income and concessional contributions exceed a certain threshold, effectively resulting in a 30% tax rate on those contributions.

Non-concessional contributions are made from income that has already been taxed at an individual’s marginal income tax rate. Consequently, these contributions are generally not taxed again when they enter the super fund. This means the full amount of the non-concessional contribution is usually credited to the individual’s super account.

Individuals who make personal super contributions from their after-tax income can choose to claim a tax deduction for these contributions. To do so, they must notify their super fund of their intention to claim a deduction using a specific form provided by the ATO and receive an acknowledgment from the fund. Once a deduction is claimed, these contributions are then treated as concessional contributions and are subject to the 15% contributions tax within the super fund.

Making contributions to a spouse’s super fund can offer a tax offset to the contributing spouse. An individual may be eligible for a tax offset of up to $540 if they contribute to their spouse’s super fund and their spouse’s income is below certain thresholds. The maximum offset is available if the spouse earns $37,000 or less and a contribution of at least $3,000 is made. The offset amount gradually reduces as the spouse’s income increases, phasing out completely when it reaches $40,000.

Government co-contributions are not taxed when they are paid into an individual’s super fund.

How to Practically Make Contributions

Making contributions to superannuation involves specific procedural steps, depending on the type of contribution.

Employer contributions, including the Superannuation Guarantee (SG) and salary sacrifice amounts, are generally handled directly by the employer through their payroll system. For SG contributions, employers are legally required to make these payments on behalf of their eligible employees. If an employee wishes to make salary sacrifice contributions, they must arrange this with their employer’s human resources or payroll department. This typically involves formally agreeing to reduce their gross salary in exchange for increased super contributions.

Personal contributions, made directly by an individual, offer several payment methods. Many super funds provide BPAY biller codes and unique reference numbers for online banking payments. Electronic Funds Transfer (EFT) is another common method, where individuals transfer funds directly to their super fund’s bank account. Super funds also often have online member portals where contributions can be made directly using a debit card or by setting up direct debits. When making personal contributions, include your name and superannuation account number to ensure correct attribution.

Spouse contributions typically follow similar payment methods to personal contributions, such as BPAY or EFT. The individual making the contribution will need the receiving spouse’s super fund details and account information to ensure the payment is directed correctly. Confirm with the super fund if any specific forms or notifications are required for spouse contributions.

Government co-contributions are not paid directly by the individual. Instead, they are automatically paid by the Australian Taxation Office (ATO) into an eligible individual’s super fund after their tax return has been lodged. This process relies on the individual making eligible personal after-tax contributions and the ATO assessing their eligibility based on their reported income and other criteria. Ensuring the super fund has an individual’s Tax File Number (TFN) is necessary for the ATO to process these payments.