Cap on non-concessional contributions
Cap on non-concessional contributions
The Government has currently set a cap, called the non-concessional
contributions cap, on the amount of non-concessional
contributions you can make in a financial year
(i.e. 1 July to 30 June) before additional tax applies. From 1 July
2017, you can contribute a maximum of $100,000 a year if you
are aged between 65 and 74, and meet the work test*. If you
are under age 65 at 1 July of the financial year, you may be able
to contribute up to three times the annual non-concessional
contribution cap under a ‘bring forward’ arrangement. The non-concessional
cap you can bring forward and whether you can
bring forward two or three year’s worth of non-concessional
contributions depends on your total super balance. These
conditions are outlined in the table below.
| Total super balance
as at previous financial year |
First year non-concessional contribution cap |
Period
brought forward |
| Less than $1.4
million |
$300,000 |
3 years |
| $1.4 million to less
than $1.5 million |
$200,000 |
2 years |
| $1.5 million to less
than $1.6 million |
$100,000 |
Nil |
| $1.6 million |
Nil |
Nil |
The three-year period starts with the year that you first
contribute more than the non-concessional contributions
cap and your contributions must not exceed a maximum of
$300,000 over a period of three years. The Government co-contribution
is not counted towards the non-concessional
contributions cap, however spouse contributions count
towards the spouse’s non-concessional cap.
The cap is applied per person, not per super fund.
This means if you have more than one super fund, all
non-concessional contributions made to all of your funds
(including any defined benefit funds) are added together
and count towards the same cap. If you exceed the cap, any
non-concessional contributions above the cap will be taxed
at 47% including Medicare levy.
* Work test: The recipient of the contribution must have worked
at least 40 hours in not more than 30 consecutive days in the
financial year that the contribution is made.