Super Contributions
Too Much Super Can Mean Extra Tax

  

There appears to be a lot of confusion regarding Superannuation contributions and in what financial year they count towards your caps.

Summary of Contributions Caps

 

 Concessional Caps
 (Under 50)
 

Concessional Caps
 (Over 50)

Concessional Caps
(Over 60)
 

Non-Concessional Cap
 

2012-13
financial 

year  

$25,000 

$25,000

 25,000

 

$150,000

 

2013-14
financial
year 

$25,000 

$25,000 

 35,000

 

$150,000

 

Tax on amounts
over the cap 

 31.5% (in addition to the 15% paid by the super fund)

 31.5% (in addition to the 15% paid by the super fund) 

 

 
46.5%

 

Note: From July 1, 2012 individuals earning more than $300,000 will pay 15 per cent extra tax on their concessional contributions, lifting their contributions tax rate to 30 per cent.

When Contributions Count

A contribution counts in the financial year in which it is made to your super fund. In general this will mean when your super fund actually receives the money. Therefore please ensure that you pay your contributions early enough in June so your super fund has time to process the contribution in the correct year otherwise you can be paying additional unnecessary tax.

If your employer regularly pays contributions for you in the month after each quarter, the 'June quarter' contributions will actually be made in July, and therefore count towards your concessional contributions cap, in the next financial year.

Example - when a contribution is made

Bette salary sacrifices $100 a fortnight. Her employer puts aside the amount each pay day and then pays the amount, along with their super guarantee obligations, on the last day of the quarter by posting a cheque to the super fund. It generally takes between one and two working days for the super fund to receive the cheque. This means that, although the amounts deducted from Bette’s salary between 1 April 2012 and 30 June 2012 are paid on 30 June 2012, the contribution is not made until the next financial year. Because this is when the super fund physically receives the money in the bank account. This contribution will therefore count towards Bette's 2012-13 concessional contributions cap.

 

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