Super Contributions Australia — Complete Guide
This article provides general information only and does not constitute financial advice. For advice tailored to your situation, consult a licensed financial adviser. Learn more.
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Understanding how to contribute to superannuation — and how to contribute strategically — is one of the highest-value financial decisions a working Australian can make. The Australian super system offers significant tax advantages for contributions, but operates within a framework of annual caps, eligibility rules, and thresholds.
The Two Types of Super Contributions
All contributions to Australian superannuation fall into one of two categories:
Concessional contributions (pre-tax) are taxed at 15% inside the fund — substantially lower than most Australians’ marginal tax rate. They include:
- Employer SG contributions (12% from 1 July 2025)
- Salary sacrifice contributions
- Personal contributions where you claim a tax deduction
The concessional contributions cap is $30,000 per financial year for FY2025–26. All concessional contributions from all sources count toward this cap.
Non-concessional contributions (after-tax) are made from money you have already paid income tax on. They are not taxed again inside the fund (subject to certain conditions). The non-concessional cap is $120,000 per financial year for FY2025–26. The bring-forward rule allows up to three years of non-concessional cap to be used in a single year ($360,000), subject to your total super balance (TSB).
FY2025–26 Contribution Caps at a Glance
| Contribution type | Annual cap | Tax inside fund |
|---|---|---|
| Concessional (pre-tax) | $30,000 | 15% |
| Non-concessional (after-tax) | $120,000 | Nil |
| Bring-forward (non-concessional) | Up to $360,000 | Nil |
Note: Non-concessional contributions are not permitted if your TSB is $1.9 million or above at 30 June of the prior year.
Employer Super — The SG
Your employer is legally required to pay 12% of your ordinary time earnings (OTE) into your super fund from 1 July 2025. This is the Superannuation Guarantee. Ordinary time earnings includes base salary, most allowances, and commissions — but generally excludes overtime.
From 1 July 2026, under the Payday Super reforms, employers must pay SG on every payday rather than quarterly. This change will improve transparency and reduce the incidence of unpaid super.
Salary Sacrifice
Salary sacrifice means directing a portion of your pre-tax salary into super instead of receiving it as take-home pay. Because the contribution is taxed at only 15% inside the fund — rather than at your marginal rate (up to 47% including Medicare levy) — salary sacrifice can produce a significant tax saving.
Example: A person earning $120,000 salary sacrificing $10,000 into super saves approximately $3,200 in income tax compared to receiving that $10,000 as salary (difference between 47% marginal rate and 15% contributions tax). Remember that salary sacrifice contributions count toward the $30,000 concessional cap.
Government Co-Contributions
If you earn below $58,445 in FY2025–26 and make personal after-tax contributions to super, the government will add a co-contribution of 50 cents for every dollar you contribute — up to $500. The co-contribution phases out above $43,445 and is not available above $58,445. No tax deduction is claimed on these contributions; they are simply a government incentive for low-to-middle income earners to save more.
Catch-Up Concessional Contributions
If your TSB is under $500,000 at 30 June of the previous financial year, you can carry forward unused concessional cap space from up to five prior years and make a larger concessional contribution in a single year. This is particularly valuable for people who took career breaks (including for caring responsibilities) and want to rebuild super when they return to higher-income employment.
Division 293 Tax
High income earners pay an additional 15% tax on their concessional contributions, bringing the effective contributions tax rate to 30% — still lower than the top marginal income tax rate of 47%. The Division 293 threshold is $250,000 of income (including concessional super contributions) for FY2025–26.
Frequently Asked Questions
How much super can I contribute each year in Australia? For FY2025–26, the concessional (pre-tax) cap is $30,000 and the non-concessional (after-tax) cap is $120,000. The bring-forward rule allows up to $360,000 in non-concessional contributions in a single year, subject to your total super balance.
Is salary sacrifice worth it in Australia? For most Australians earning above the $45,001 tax bracket, salary sacrifice into super saves tax — the difference between your marginal tax rate and the 15% contributions tax. The higher your marginal rate, the greater the saving.
What is the employer super rate in 2025? The Superannuation Guarantee rate is 12% of ordinary time earnings from 1 July 2025. This is the final step in the legislated schedule.
Can I contribute to super if I’m not working? Yes, if you are under 75, you can make personal non-concessional (after-tax) contributions regardless of employment status. A work test applies for personal deductible contributions between ages 67 and 74.
For advice tailored to your situation, speak with a licensed financial adviser. You can find one through the ASIC financial advisers register or MoneySmart.