How to grow your super (Superannuation)
This super guide explains your options for growing your superannuation plan and maximising your oppertunities for an increased return when your superannuation matures.
In addition to your employer super guarantee contributions, you can boost your super by entering into a salary sacrifice arrangement with your employer, making your own contributions or you may be eligible for government contributions.
Super from my employer
How much your employer should pay
If you’re eligible for super guarantee contributions, at least every three months your employer must pay into your super account a minimum of 9.5% of your ordinary time earnings, up to the ‘maximum contribution base’ (rate current as of 1 July 2014).
Note: If your employer is from Norfolk Island they should pay super guarantee (SG) at a rate of 1%. This rate will increase yearly over the next 12 years.
These payments are classified as employer contributions and count towards your concessional (before-tax) contributions cap.
Ordinary time earnings are generally what you earn for ordinary hours of work, including over-award payments, commissions, allowances, bonuses and paid leave.
If you’re a contractor, the minimum super amount should be calculated on the labour component of your contract, if it’s possible to separate it out. Otherwise it should be calculated on the total amount.
Concessional contributions cap
Concessional contributions include:
- Employer contributions (including contributions made under a salary sacrifice arrangement)
- Personal contributions claimed as a tax deduction by a self-employed person.
If you have more than one fund, all concessional contributions made to all of your funds are added together and counted towards the concessional contributions cap.
|Income year||Date||Your age at this date||Your concessional contribution cap||Treatment of excess concessional contributions|
|2016–17||30 June 2016||<49||$30,000||Included as taxable income, taxed at marginal tax rate plus an excess concessional contributions charge|
|2015–16||30 June 2015||<49||$30,000|
|2014–15||30 June 2014||<49||$30,000|
|2013–14||30 June 2013||<59||$25,000|
|2012–13||All ages||$25,000||Taxed at 46.5%|
(15% levied in super fund, additional 31.5% payable)
|2011–12||30 June 2012||<50||$25,000|
|2010–11||30 June 2011||<50||$25,000|
|2009–10||30 June 2010||<50||$25,000|
|2008–09||30 June 2009||<50||$50,000|
|2007–08||30 June 2008||<50||$50,000|
General concessional contributions cap
The concessional contributions cap is indexed in line with average weekly ordinary time earnings (AWOTE), in increments of $5,000 (rounded down). The new indexed amount is generally available each February.
Note: Indexation of the general concessional contributions cap was paused at $25,000 up to and including the 2013–14 year. Normal indexation resumed for the 2014–15 year.
Higher concessional contributions cap for the 2013–14 and later financial years
The concessional contributions cap was temporarily increased to $35,000 for the:
2013–14 financial year if you were aged 59 years or over on 30 June 2013
2014–15 financial year or a later financial year if you were aged 49 years or over on the last day of the previous financial year.
The temporary higher cap is not indexed and will cease when the general concessional contributions cap is indexed to $35,000.
Higher concessional contributions cap for the 2012–13 year
For the 2012–13 financial year, the higher concessional contributions cap was equal to the general concessional contributions cap of $25,000.
Higher concessional contributions cap for the 2011–12 and earlier financial years
An increased concessional contributions cap applied until 30 June 2012 for people aged 50 years or over:
- If you were aged 50 years or over, your annual cap for the 2007–08 and 2008-09 financial years was $100,000.
- If you were aged 50 years or over, your annual cap for the 2009–10, 2010–11 and 2011–12 financial years was $50,000.
If you had more than one fund, all concessional contributions made to all of your funds were added together and counted towards the cap. This cap was not indexed.
Government super contributions
You may be eligible for either the super co-contribution or the low-income super contribution (LISC) or both, which means the government also adds to your super.
You don't need to apply for either the co-contribution or LISC payment. If you're eligible, have lodged your tax return and your fund has your tax file number (TFN), The ATO will pay it to your fund account automatically.
The super co-contribution is intended to help eligible people boost their retirement savings.
If you are a low- or middle-income earner and make personal (after-tax) super contributions to your super fund, the government also makes a contribution (called a co-contribution) up to a maximum amount ($500 in 2014-15).
If you have more than one super fund and you want your co-contribution paid to a particular one, use a Superannuation fund nomination form.
If you are now retired and no longer have an eligible super account that will accept the co-contribution you can request a direct payment using your myGov account.
Low-income super contribution (LISC)
The low-income super contribution (LISC) is a government superannuation payment of up to $500 to help low-income earners save for retirement.
If you earn $37,000 or less a year, you may be eligible to receive a LISC payment directly into your super fund.
The LISC is 15% of the concessional (before tax) super contributions you or your employer pays into your super fund for the 2012-13 to the 2016-17 financial years.
You can apply to have your LISC paid directly to you if you have reached your ‘preservation age’ and are retired
People who read this Australian tax guide also viewed:
Australia Tax Calculators & Tools
- Annual Tax Calculator
- Monthly Tax Calculator
- Four Weekly Tax Calculator
- Fortnightly Tax Calculator
- Weekly Tax Calculator
- Daily Tax Calculator
- Hourly Tax Calculator
- Student Financial Supplement Scheme (SFSS) fortnightly tax calculator
- Income tax on $10,000
- Income tax on $25,000
- Income tax on $30,000
- Income tax on $40,000
- Income tax on $50,000
- Income tax on $60,000
- Income tax on $70,000
- Income tax on $100,000
- Allowances and Withholdings
- Gross Pay
- Hecs Help Debt
- Income Tax
- Low Income Tax Offset
- Take Home Pay
- Taxable Income