Information for advisers only.
Non-concessional contributions are contributions where a tax deduction has not been claimed. The contributions are not taxable to the super fund and are preserved benefits. Non-concessional contributions include:
-
Personal after tax contributions
-
Spouse contributions
-
The non-taxable amount of foreign super transfers
-
Any concessional contributions in excess of the concessional contribution cap that are not released
Contributions are counted against the cap in the financial year they are allocated to the member’s account. The non-concessional contribution cap is set at four times the current concessional contribution cap. For the 2023/24 financial year, the cap is $110,000. However, non-concessional contributions cannot be made if a member’s Total Superannuation Balance (TSB) is:-
- $1.9 million or greater as at 30 June 2023 for the 2023/24 financial year,
- $1.7 million or greater as at 30 June 2022 for the 2022/23 financial year, or 30 June 2021 for the 2021/22 financial year,
- $1.6 million or greater as at 30 June in the preceding financial year for 2017/18 to 2020/21 financial years.
An exception to this rule is where the contributions relate to a structured settlement or order, for personal injuries.
The following contributions are not measured against the non-concessional contributions cap:
- Government co-contribution
- Contributions relating to structured settlements or orders for personal injuries
- Contributions relating to and not exceeding the CGT cap amount
- Downsizer contributions
The bring-forward rule
Since 1 July 2022, where a member's TSB is less than the general transfer balance cap ($1.9 million for 2023/24) and they are less than age 75 as at 1 July of the financial year a contribution is to be made, the ‘bring-forward’ non-concessional contribution cap that can be triggered is determined by their TSB just before 1 July, as shown in the table below. They are not required to contribute the amount all at once, but once triggered, it’s in force for the duration of the two or three year bring-forward period.
|
TSB on 30 June 2023 |
Non-concessional contributions cap for the first year |
Bring-forward period |
|---|---|---|
|
Less than $1.68 million |
$330,000 |
3 years |
|
$1.68 million to less |
$220,000 |
2 years |
|
$1.79 million to less |
$110,000 |
No bring-forward |
Members aged 74 on 1 July of the financial year who make a non-concessional contribution will also need to make the contribution on or before the day that is 28 days after the end of the month in which they turn 75.
Excess contributions
Where a member exceeds their non-concessional contribution cap, the ATO will issue the member with a tax assessment notice outlining the amount in excess and any associated penalty tax. The ATO will also issue a release authority which the member can send to their nominated super fund to have the excess amount (plus associated earnings) withdrawn.
Members have the option of withdrawing excess non-concessional contributions made from 1 July 2013 and any associated earnings (calculated on a notional basis), with the earnings only taxed at the individual's marginal tax rate (less a 15% non-refundable tax offset).
Should the member nominate to leave the excess non-concessional contributions in the super fund, the excess contribution amount is taxed at the highest marginal tax rate, and the source of funds to pay this amount must be from the super fund.
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