6 Things To Know About Your Super Fund

6 Things To Know About Your Super Fund

Super young or super old – it’s important to know how your Super works.

Whether your Super Fund has been up and running for years or you just started learning the ropes, we’ll let you in on a few rules you should know.


Know that there is a Superannuation Guarantee.

Employers are typically required to contribute to your Super Fund at a rate of 9.5% of your ordinary time earnings*. It’s even been rumored that this rate will increase to 12% in upcoming years.

*Ordinary time earnings are what what employees earn for their ordinary hours of work. These include over-award payments, commissions, shift loading, and certain bonuses and allowances. Overtime is not considered part of ordinary time earnings.


Know that there are two types of Super contributions.

Concessional Contributions are payments made to your Super prior to your income tax being taken out. These contributions are taxed at a flat rate of 15% once they enter your Super fund and include:

  • Employer contributions
  • Salary sacrificed contributions
  • Other contributions in which you have claimed a tax deduction

Non-Concessional Contributions are personal payments made to your Super after-tax. These contributions have technically already been taxed so they will not be taxed once they enter into your Super Fund.


Know that there is a Double Contributions Tax for high-income earners.

Unfortunately, those who have an annual adjusted taxable income over $300,000 will be taxed an additional 15% on their concessional super contributions. This additional tax is called the Division 293 Tax. High-income earners are responsible for paying this after lodging their tax return for the year.


Know that there are Super Contribution Caps.

These general concessional contribution caps are based on your income and age and are as follows for 2015/2016:

  • $30,000 for anyone 48 years or younger as of 30 June 2015
  • $35,000 for anyone 49 years or older as of 30 June 2015

Starting in May of 2016, the capping rules on non-concessional contributions have changed. Many of us are familiar with the Bring-Forward Rule which allowed contributions to roll over up to $540,000 over a three-year period. This rule is no longer in effect. Instead, Australians are now subject to a lifetime cap on non-concessional contributions of $500,000.


Know your preservation age.

When you can access your super benefits (penalty-free) is limited to those who have reached their preservation age. Your preservation age is determined by your date of birth and ranges from 55 to 60 years old.


If your DOB is:Your preservation age is:
before 1 July 196055
from 1 July 1960 - 30 June 196156
from 1 July 1961 - 30 June 196257
from 1 July 1962 - 30 June 196358
from 1 July 1963 - 30 June 196459
after 30 June 196460


Know that lodging your tax return can give you an idea of the Super you are saving.

Most of us won’t see a cent of our superannuation for years! That doesn’t mean that it doesn’t matter now. You can start planning ahead now and it all starts with lodging your tax return. With E-Lodge, you can prepare your return online and include your Super contributions for the year in the income section of your account. This shows you how much you have for the current financial year to go toward your future.


Happy saving!


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