Q: I was born in May 1968 (turning 50 in May 2018). Can you explain which financial year I am considered to be over 50 in relation to the special $35,000 concessional contributions cap?
A: Since 1 July 2017, there is no longer a special over-50s concessional (before-tax) contributions cap, so the timing of turning 50 no longer makes a difference.
A single annual cap of $25,000 applies to all age groups. For more information, see SuperGuide article Super concessional (before-tax) contributions: 2017/2018 survival guide.
For those readers interested in the pre-July 2017 rules, in particular, the special contributions rules that applied (for the 2016/2017 year and earlier years) for those aged 50 years or over, the continue reading this article.
Special over-50s cap applied until 30 June 2017
Before July 2017, generally speaking, if you were aged 50 years or over, you could take advantage of a special concessional cap of $35,000 (for the 2016/2017 year. If you were under the age of 50, then your concessional cap was $30,000 for the 2016/2017 financial year. Note that the rule is more specific than these comments which I explain below.
More specifically, if you were aged 49 years or older on 30 June 2016, then your concessional (before-tax) cap for the 2016/2017 year was $35,000. If an individual was aged 49 years or over on 30 June 2016, then he or she had a special annual concessional contributions cap of $35,000, for the 2016/2017 financial year.
Individuals aged 48 years or younger on 30 June 2016 had an annual concessional cap of $30,000 (for the 2016/2017 year).
Before July 2017, a person turning 50 during a financial year could make up to $35,000 in concessional contribution before extra tax applied to any further concessional contributions. For example, a person turning 50 in May 2017 could contribute $35,000 in the 2016/2017 financial year
Australians aged 50 years and over were able to access a $35,000 concessional cap from 1 July 2014 until 30 June 2017. More specifically, for the 2014/2015 financial year and later financial years, if you were aged 49 years or over on 30 June of the previous financial year then your concessional cap was $35,000. For the 2013/2014 year, the $35,000 cap applied to over-60s.
You can find updated general information on concessional contributions in the SuperGuide article Super concessional (before-tax) contributions: 2017/2018 survival guide.
You need to confirm your personal circumstances, and what concessional cap applies to you, with the ATO.