Tax Alert - Changes to double concessional tax rate on earnings from super balances over $3 million

Lowe Lippmann Chartered Accountants

Changes to double concessional tax rate on earnings from super balances over $3 million


The Government has announced plans to increase the concessional tax rate from 15% to 30% on superannuation earnings from superannuation fund balances over $3 million from 1 July 2025.


The changes are planned to begin on 1 July 2025, just after the next federal election. Treasurer Jim Chalmers said the timing of the introduction will be “allowing Australians to go to the polls on the issue”.


This announcement does not impose a limit on the size of superannuation account balances in the accumulation phase, and only applies to future earnings, with the changes not being retrospective before 1 July 2025.


It was confirmed that there are no current plans to annually index the $3 million threshold chosen for this announcement, meaning the level at which the higher tax rate of 30% will be levied would not rise over time.


It is relevant to note this announcement is likely to impact less than 1% of all superannuation fund balances in Australia, which is approximately 80,000 individuals. Furthermore, the fundamentals of the superannuation system are not being altered in any other way.


We note that this proposed change potentially marks a seismic shift in superannuation for some of our clients. However, there is a lot of water to go under the bridge between now and the proposed commencement date of this legislation.


We will continue to keep you informed of any major developments as they occur.


Please do not hesitate to contact your Lowe Lippmann Relationship Partner if you wish to discuss any of these matters further.

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