The superannuation contributions caps for concessional (before tax) and non-concessional (after tax) contributions for the 2018/2019 year, are the same as those that apply for the 2017/2018 year. (Note that the higher contributions caps applicable for the 2016/2017 year, are also set out later in the ... Read more
Excess contributions
The amount of money you can deposit in superannuation fund each year, is subject to superannuation contributions caps.
Concessional (before-tax) contributions are subject to an annual concessional contributions cap, which is increased periodically.
Non-concessional (after-tax) contributions are also subject to an annual non-concessional contributions cap (indexed in line with the concessional contributions cap), and Australians under the age of 65 can bring forward up to 2 years of the non-concessional cap in a single year (bring-forward rule).
If your super contributions (concessional or non-concessional) exceed the relevant cap, the amount of super contributions above the cap are known as excess contributions – excess concessional contributions if above the concessional cap, and excess non-concessional contributions if above the non-concessional cap.
For a summary of the excess contributions rules, see SuperGuide article Excess contributions rules: A quick summary. For a quick explanation of the rules, continuing reading the next few paragraphs.
Excess concessional contributions
Excess concessional (before-tax) contributions and associated earnings are counted towards the person’s assessable income for the financial year in which the excess contributions were made, less a 15% tax offset for contributions and earnings tax already paid. Excess concessional contributions can be withdrawn from the super fund to pay the additional income tax.
Excess non-concessional contributions
Excess non-concessional (after-tax) contributions can be withdrawn, and the associated earnings on those excess contributions count towards the person’s assessable income, less a 15% tax offset for contributions and earnings tax already paid. If a person chooses not to withdraw the excess non-concessional contributions, then those excess contributions are subject to the top marginal rate of tax.
Below are key articles on excess contributions:
Set out below are all SuperGuide articles referring to Excess contributions.
Understanding the transitional bring-forward rule (for 2018/2019 and 2017/2018 years)
Q1: What cap applies for the 2017/2018 year, if I triggered the bring-forward rules during the 2016/2017 or 2015/2016 years? Q2: What cap applies for the 2018/2019 year, if I triggered the bring-forward rules during the 2016/2017 year? Transitional arrangements apply for Australians who are in the middle of a ... Read more
Non-concessional contributions: Tread carefully when aged 63 or 64 or 65 (3 Q & As)
Note: For the 2018/2019 year, and for the 2017/2018 year, the non-concessional cap is $100,000 and the 3-year bring-forward cap is $300,000. For the 2016/2017 year, the non-concessional (after-tax) cap was $180,000, and the 3-year bring-forward cap was $540,000. Q: I am 64 and want to take advantage of the ... Read more
After-tax super contributions: Beef up using a bring forward
Note: For the 2018/2019 financial year (and for the 2017/2018 year), the annual non-concessional contributions cap is $100,000, and the 3-year bring-forward cap is $300,000. (For the 2016/2017 year, the annual after-tax contributions cap was $180,000 and the 3-year bring-forward cap was $540,000.) Q: Under the ... Read more
Bring-forward rule: A definitive super guide
Note: The information in this article relates to the 2018/2019 financial year and the 2017/2018 financial year (and also refer to the rules applicable for the 2016/2017 financial year). Since 1 July 2017 (from the 2017/2018 year), a lower annual non-concessional (after-tax) contributions cap of $100,000 applies, and ... Read more
Super contributions: Bring-forward rule and your Total Superannuation Balance
Since 1 July 2017, your Total Superannuation Balance can affect how much you can contribute to a super fund. If your Total Superannuation Balance is $1.6 million or more (for the 2017/2018 year, or for the 2018/2019 year), then you cannot make any non-concessional (after-tax) contributions – your NCC cap is nil, and ... Read more
Gone but not forgotten: Concessional contributions cap for over-50s
In July 2013, the federal government introduced a temporary concessional contributions cap of $35,000 for over-60s, which was then expanded to 50-somethings from July 2014. The over-50s cap of $35,000 has now been abolished, effective since 1 July 2017. Older Australians have not been able to take advantage of the ... Read more
Concessional contributions cap: A quick guide (10 Q&As)
We receive many questions about the concessional contributions caps. We regularly update readers on any changes to the contributions caps (and other super changes), and the implications of such changes on super strategies. The list of 10 Q&As set out below answer many of questions that we have received on the ... Read more
Higher concessional contributions cap no longer applies for over-50s
The special over-50s cap for concessional contributions no longer applies, and was only applicable until the end of the 2016/2017 year. In the 2016 Federal Budget, the Liberal government announced that the over-50s cap would be abolished from 1 July 2017, and would revert to a single concessional contributions cap ... Read more
Contributions caps: What’s going on with the catch-up concessional contributions rule?
Note: In the May 2016 Federal Budget, Treasurer Scott Morrison announced the end of the over-50s concessional (before-tax) contributions cap, which took effect from 1 July 2017. Instead, the federal government introduced a catch-up opportunity for Australians with less than $500,000 in super. Continue reading for more ... Read more
Does the government’s co-contribution count towards my contributions cap?
Q: Does a co-contribution received after using up the total bring forward cap of $300,000 mean that an excess contribution has been made, or is the Government co-contribution excluded from the after-tax contribution cap? A: A superannuation co-contribution is a super contribution paid by the federal government into ... Read more
Super for beginners, part 15: Super tax – as easy as 1-2-3
Superannuation only exists because of how super savings are taxed. Superannuation savings receive tax incentives to encourage Australians to choose super as a retirement savings option. Even so, superannuation is still taxed (for most Australians), but at a lower rate of tax than non-superannuation income and ... Read more
