If you want to supercharge your superannuation savings, non-concessional contributions provide a much higher limit of $100,000 per financial year. You may also choose to ‘bring-forward’ three years (current and subsequent two financial years) of non-concessional contributions making up to $300,000 in the current year. You won’t be able to claim a deduction for your non-concessional contributions.
- Your total superannuation balance on 1 July of the financial year must have been less than $1.6 million.
- If you intend on triggering the ‘bring-forward’, you can only do so if you were under 65 on 1 July of the financial year.
- Be sure to check the current and prior two financial years contributions to ensure you haven’t inadvertently done in the past. This may result in excess contributions tax or a surcharge charge from the ATO.
If you earn below $53,564, you may be eligible for the government co-contribution of up to $500 if you make a personal contribution of $1,000.
- Check that you meet the 10% eligible income test. To meet the test, more than 10% of your income must come from employment, self-employment or a combination.
Final considerations before making any contributions
Check your eligibility to contribute to super. Were you under 65 at the beginning of this financial year or you are between 65 and 75 and meet the work test (working 40 hours in a 30 day period during the financial year)?
Be sure to start planning early to avoid disappointment as far too often a transfer, BPay or cheque payment fails to clear before 30 June.
As always, get good advice. Speak with a qualified financial adviser or accountant as superannuation contributions are fraught with trips and traps.