Making extra contributions to your super

In most cases, your employer is required by law to contribute a certain amount to your super. This mandatory contribution is called the Super Guarantee (SG) and is currently set at 9.5% of an employee’s Ordinary Time Earnings (OTE)*. You may wish to make additional contributions to your super fund if you feel you need to put away more for your retirement.  There are a number of different ways to contribute to your super.

The ASFA Retirement Standard indicates that for a comfortable retirement lifestyle*, a single person would need to spend about $43,538 per annum, and a couple would need to spend about $59,808 per annum.

 

Others suggest that a retirement income of 65% of your current salary is ideal. The level of retirement income you’ll need depends on your specific circumstances and the type of lifestyle you want.

 

To see how you’re tracking, check out our Retirement Income Calculator and put in your own details to get a better idea of how much super you might have by the time you retire. You can also see how adding extra money to your super now could affect your balance.


There is no limit to how much you can add to your super, however the Government has set caps on the amount of before-tax money you can add to super each year on a concessionally taxed basis. In addition, the Government has set a contributions cap on the amount of after-tax money you can add to super.  When making additional contributions to super, it’s important to take care not to exceed your contributions caps as contributions above these caps may be subject to additional taxes and charges. 

 

For more information about the contributions caps, visit ato.gov.au and search ‘super contributions’. 


Salary sacrifice is an arrangement between you and your employer where you ask your employer to allocate a portion of your before-tax wage or salary as an extra contribution to your super. While personal super contributions come out of your after-tax salary (ie. after you have paid tax at marginal tax rates), salary sacrifice contributions come out of your before-tax salary and are only taxed at 15% (up to certain limits – see contributions caps above). So if your marginal income tax rate is higher than 15%, salary sacrificing could be a great way to build your super balance and significantly reduce the tax you pay at the same time.

 

Salary sacrifice contributions count towards your concessional contributions cap, as do any super contributions made for you by your employer. It’s important to take care not to exceed your contributions caps as contributions above these caps may be subject to additional taxes and charges.

 

For more details about the contributions caps, visit ato.gov.au and search ‘super contributions’.


'After-tax' contributions are when you add money to your super account after you’ve already paid income tax on it.

 

Money you add your super from your after-tax income doesn’t get taxed on entry to the super fund because you’ve already paid tax on this money. In addition you only pay up to 15% tax on any earnings you make in your super account, whereas investments outside of super are taxed at your  marginal tax rate.

 

Personal contributions generally count towards your non-concessional contributions cap. It’s important to take care not to exceed your contributions caps as contributions above these caps may be subject to additional taxes and charges.

 

For more details about the contributions caps, visit ato.gov.au and search ‘super contributions’.


You can add money to your spouse’s super from your after-tax income. You can only make a contribution to your spouse’s super if your spouse has given their TFN to their super fund, is less than 70 when the contribution is made, or is aged 65-69 and has been gainfully employed for at least 40 hours in a period of not more than 30 consecutive days in the financial year in which the contribution is made.

 

If your spouse is a low income earner, you may be eligible for a tax offset. You may be able to claim an 18% tax offset of up to $540 on super contributions of up to $3,000 you make for your spouse. The maximum tax offset may be available if your spouse’s total income** is less than $37,000. The maximum tax offset decreases gradually until your spouse’s total income exceeds $40,000.

 

Spouse contributions made by BPAY must be made from your spouse’s bank account or a joint account where your spouse is an account holder.

 

Contributions made to your super by your spouse generally count towards your non-concessional contributions cap. It’s important to take care not to exceed your contributions caps as contributions above these caps may be subject to additional taxes and charges.

 

For more details about the contributions caps, visit ato.gov.au and search ‘super contributions’.


Whether you’ve just found some lost super or have multiple accounts with different providers, combining all your super into one account could mean you can stop paying multiple account keeping fees.

 

You can transfer money from your other super accounts into your BT Super account at any time using BT’s easy rollover tool.

 

Before moving your super, you should check with your other fund(s) to check if there are any exit fees for moving your benefit, or other loss of benefits such as insurance cover.


Depending on how much you’re earning, and subject to other eligibility criteria, the Government may make contributions into your super account. These contributions include:

  • the Government co-contribution, which is paid to eligible individuals who make an after-tax contribution to super and
  • the low income superannuation tax offset, which is paid to eligible individuals who receive a before-tax contribution, such as an employer contribution into their super.

 

For more information about these Government contributions, including eligibility requirements, visit ato.gov.au.


If you qualify, you may contribute certain proceeds from the disposal of small business assets to your super and have these contributions counted against the CGT cap rather than your non-concessional contributions cap. You should seek professional tax advice about whether your proposed contributions qualify under these rules.

 

Once you’re satisfied that the contribution will qualify under the rules, The contribution must be made no later than the day you’re required to lodge your tax return for the financial year in which the Capital Gains Tax (CGT) event occurred or 30 days after the day you received the capital proceeds, whichever is later. If the capital proceeds are received and contributed in instalments, each instalment is considered a separate contribution and must be made within the above timeframe.

 

When you make the contribution, you need to let us know that you’re electing to use the CGT cap for all or part of the contribution by giving us a completed Capital gains tax election form (available from ato.gov.au).


You may be able to contribute to your super amounts from certain personal injury payments, and have these contributions excluded from the contribution caps. The personal injury payment must be in the form of a structured settlement, an order for a personal injury payment or a lump-sum workers compensation payment. In addition, two legally qualified medical practitioners must certify that as a result of the injury, you’re unlikely to ever be able to be gainfully employed in a capacity for which you’re reasonably qualified. You should need to seek professional advice about whether your proposed contributions qualify under these rules.

 

Once you’re satisfied that the contribution will qualify under the rules, the contribution must be made within 90 days of the payment being received or the structured settlement or order coming into effect, whichever is later. You must notify us at the time of making the contribution that is to be excluded from the caps by providing a completed Contributions for personal injury election form (available from ato.gov.au).

From 1 July 2017, anyone who is eligible to contribute to super is eligible to claim a deduction for personal contributions. Note that in order to claim a deduction for personal contribution, you must lodge the appropriate form with your super fund. Contact your fund for the form and information about when the form must be lodged.

 

Personal deductible contributions are only taxed at 15% (up to certain limits). So if your marginal income tax rate is higher than 15%, salary sacrificing could be a great way to build your super balance and significantly reduce the tax you pay at the same time.

 

Personal deductible contributions count towards your concessional contributions cap, as do any super contributions made for you by your employer. It’s important to take care not to exceed your contributions caps as contributions above these caps may be subject to additional taxes and charges. 

 

For more details about the contributions caps, visit ato.gov.au and search ‘super contributions’.

BT's Retirement Income Calculator

Explore small changes that can make a difference in retirement

Start now

Boost your super

Learn how to build your super

Read now

Speak to a BT Consultant

If you have any questions about your super.

Call us on 132 135