Superannuation Contribution Caps

The tax laws limit the amount of money you can voluntarily contribute to your super account on a concessional basis. This is achieved by setting the superannuation contribution limits which operate to ration the tax benefits available each year.

There is no limit to how much super you are allowed to accumulate, but there is a limit to the tax concessions you can receive on each year’s contributions.

Making contributions over the limits results in additional tax payable, and excess concessional contributions are counted towards the non-concessional cap. However, from 1 July 2013 excess concessional contributions can be withdrawn, and taxed at the individual’s marginal rate plus interest. Under 2014-15 Budget proposals, legislation was passed in March 2015 to treat excess non-concessional contributions on a similar basis.

The potentially higher tax means that in most instances members will want to keep super contributions within the allowable caps limits which are set in relation to age and the financial year of contribution.