Upper limit on SG contributions (2012/2013 year)

Note: This article explains the maximum superannuation contribution base for the 2012/2013 year. You can also find the MSCB for the 2011/2012 year and previous years.

The maximum superannuation contribution base is used to determine the maximum Superannuation Guarantee (SG) contribution that an employer is required to make under the super laws. The maximum superannuation contribution base for the 2012/2013 year is $45,750 per quarter or the equivalent of $183,000 per year.

All eligible employees have a right to SG, although the amount of SG you receive is subject to this upper income limit, which is indexed each financial year. What this means in terms of Superannuation Guarantee terms is: the maximum SG that an employer is legally required to contribute is the equivalent of 9% of a person’s salary up to a maximum salary of $45,750 per quarter ($183,000 a year). The maximum quarterly SG payment works out to be $4,117.50 per quarter, that is, $16,470 for the year.

Your employer must contribute 9 per cent of your salary only up to the maximum superannuation contributions base, which is linked to an individual’s earnings. If your income for SG purposes exceeds $45,750 each quarter ($183,000 a year), your employer makes your SG contributions on the basis of the maximum superannuation contributions base.

Your employer doesn’t have to pay contributions under the SG rules for any earnings above this limit. For example, if you earn $200,000 a year plus SG, your employer doesn’t contribute 9 per cent of your $200,000, but 9 per cent of $183,000 (for the 2012/2013 year), which works out to be $16,470 a year (or $4,117.50 each quarter).

Note: In most cases individuals on higher incomes receive super benefits as part of a salary package, which means SG contributions are based on a much lower figure than a person’s total remuneration anyway. The maximum superannuation contributions base is adjusted each year in line with increases in average wages. The base amounts for the previous 17 years appear in the table below. The contents of the table have been sourced from the ATO website.