Tax Alert - Planning for Superannuation Contributions before 30 June 2026

Lowe Lippmann Chartered Accountants

Planning for Superannuation Contributions before 30 June 2026

As the end of the financial year is approaching, we take this opportunity to remind you of the various superannuation thresholds, opportunities, obligations and changes, including topics such as:

Concessional contributions
Non-concessional contributions
Superannuation guarantee
Impending changes to superannuation from 1 July 2026

Concessional contributions

A concessional contribution is a payment made into your superannuation fund and is subject to tax (known as ‘before-tax contributions’) and includes employer’s compulsory super guarantee contributions, salary sacrificed contributions and personal contributions made by you which is from your after-tax dollars and for which you are claiming a tax deduction.

Concessional contributions are taxed at 15% upon receipt by the superannuation fund. However, individuals with income including concessional contributions exceeding $250,000 may be subject to an additional Division 293 tax on the excess of up to 15%, effectively increasing the tax up to 30%.

The concessional contribution cap for the current year ending 30 June 2026 is $30,000.

From 1 July 2026, concessional contributions will be increased from the previous year cap of $30,000 to $32,500 per year and continue to be taxed at 15% upon receipt by the superannuation fund.

If you have more than one superannuation fund, all concessional contributions made to all of your funds are added together and counted towards the concessional contributions cap.

The payer (either the employer or the individual making a personal contribution) is generally entitled to a tax deduction for the amount of the contribution.

To see full details for making Concessional Contributions – click here

Non-concessional contributions

Non-concessional contributions are contributions made from after-tax dollars and the payer (the individual making the personal contribution) does not claim a tax deduction for it.

Non-concessional contributions are post-tax contributions. Although there typically is not an immediate tax saving on NCCs the superannuation accumulation (pre-retirement) tax rate of 15% is typically lower than many people’s marginal tax rate and the tax rate on superannuation earnings and drawdowns may be tax-free in retirement (subject to a pension transfer balance cap of $2,100,000 from 1 July 2026).

The non-concessional contribution cap for the current year ending 30 June 2026 is between $0 or $120,000 (depending on your personal circumstances), subject to the bring-forward concession, which is the maximum amount of after-tax contributions you can contribute to your superannuation fund each year without contributions being subject to extra tax.

From 1 July 2026, the non-concessional contributions cap will be increased and capped at between $0 or $130,000 per year (depending on your personal circumstances), subject to the bring-forward concession.

If you have more than one superannuation fund, all non-concessional contributions made to all of your funds are added together and counted towards the non-concessional contributions cap.

To see full details for making Non-Concessional Contributions – click here

Superannuation guarantee

Significant changes in relation to compulsory superannuation guarantee (SG) contributions are happening from 1 July 2026.

Up to 30 June 2026, the existing rules continue where it is compulsory for an employer to pay their eligible employees SG to their nominated superannuation fund, based on their ‘ordinary time earnings’ and the relevant annual SG rate, by the quarterly due date.

From 1 July 2026, the new Payday Super rules will apply where it will be compulsory for an employer to pay their eligible employees SG to their nominated superannuation fund, based on their ‘qualified earnings’ (instead of the current ‘ordinary time earnings’) and the same relevant annual SG rate. Most importantly, all SG payments must reach the employee’s superannuation fund within 7 business days of each pay cycle, regardless of whether this is weekly, fortnightly or monthly.

The new Payday Super rules (applying from 1 July 2026) are explained in full detail below under the final heading in this Tax Alert: “Impending proposed change to superannuation from 1 July 2026”.

To see full details about Superannuation Guarantee requirements – click here

Impending change to superannuation from 1 July 2026

Additional Div 296 tax on total superannuation balances over $3 million from 1 July 2026

The new Division 296 (Div 296) rules commence on 1 July 2026 and will introduce additional 15% tax on a portion of attributed "superannuation earnings" above a member’s total superannuation balance (TSB) above $3 million (large balance) at 30 June 2027.

Also, a further additional 10% tax (resulting in a total 25% tax) on a portion of attributed "superannuation earnings" above a member’s TSB above $10 million (very large balance) at 30 June 2027.

The Div 296 tax will only apply to realised earnings, for example earnings in cash after an investment asset has been sold, rather than “unrealised gains” on assets that have not been sold.

The Commissioner of Taxation will calculate a Div 296 tax liability and notify individuals of their tax liability for a given income year. The Div 296 tax will be separate to the individual’s personal income tax and the superannuation fund tax (15%). Individuals will have the option of paying their tax liability by either releasing amounts from their superannuation or using amounts outside of the superannuation system.

Payday Superannuation

The new Payday Super changes apply from 1 July 2026. We have prepared a checklist of tasks that employers need to consider and complete to prepare for the Payday Super changes.

Various new concepts and requirements been considered in detail, such as the new super calculation using ‘qualifying earnings’ instead of the current ‘ordinary time earnings’ category.

We recommend that all employers take actions as soon as possible (if they have not already) to be best prepared for the Payday Super changes coming in from 1 July 2026.

Retirement Income Streams

Individuals who commence a retirement phase income stream (ie. pension) for the first time after 1 July 2026 will have access to the full $2.1 million limit.

To see full details about this proposed change – click here

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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Practice Update – November 2026

November 4, 2026

ATO to continue accepting credit cards until 30 June 2027, but the clock it still ticking Last month, in our Practice Update for October 2026 ( see here ), we noted the Australian Tax Office ( ATO ) announced it will stop accepting credit cards as a payment method after 30 November 2026, following the Reserve Bank of Australia’s ( RBA ) ban on card surcharges from 1 October 2026. The ATO has since confirmed that it will continue to accept credit card payments for tax obligations until 30 June 2027 . After 30 June 2027, taxpayers who wish to continue using a credit card to meet their tax obligations may continue to use third-party payment providers as outlined at www.ato.gov.au/howtopay What do these change mean for you? The extension does not cancel the planned withdrawal of direct credit card payments. From 1 July 2027, you will need to use another method to pay the ATO directly. Available alternatives include: Debit card BPAY Bank transfer Direct debit Payment at Australia Post (where available) International money transfer services (where applicable) Some third-party payment providers may continue to offer ways to pay tax using a credit card after the deadline. However, these services may charge additional fees and take longer to process payments. Check the total cost, processing time and payment conditions before relying on one. Why does your payment method matter? Credit cards can help bridge short-term cash-flow gaps, but the convenience comes at a cost. Interest, annual fees and other charges can erode the benefit, particularly if you regularly carry a balance. There is also a risk that a payment will not be processed in time, potentially leaving you with an overdue tax liability and additional interest. Switching to BPAY, bank transfer or direct debit may provide a simpler and more predictable way to manage tax payments. The right option will depend on your circumstances, including when funds are available in your business account and whether you need to retain flexibility over payment dates. Pay particular attention if you have an existing ATO payment plan linked to a credit card. The ATO has been contacting affected taxpayers, but you should check your own arrangements rather than assume they will continue unchanged. Confirm how future instalments will be paid and allow enough time to update the payment method before the deadline. What should you do now? Use the extended timeframe to prepare rather than leaving the change until the last minute. Review your current arrangements. Check whether you use a credit card for one-off tax payments, regular instalments or an ATO payment plan. Choose an alternative. Consider which payment method best suits your cash-flow cycle, taking account of fees and processing times. Update recurring payments early. Make sure any new arrangements are in place well before 30 June 2027 and check that payments are processed successfully. Review your cash flow. If you rely on the credit card interest-free period to manage tax liabilities, consider whether you need to set aside funds earlier or adjust your payment planning. Seek advice if needed. If tax payments are putting pressure on your cash flow, speak with us early so we can help you review your position and consider practical ways to manage upcoming liabilities. The extension to 30 June 2027 gives businesses more time to adjust, but it should not be mistaken for a permanent reprieve. Planning ahead can help you avoid unnecessary fees, missed payments and last-minute disruption when the ATO’s direct credit card facility closes.

Practice Update – October 2026

October 7, 2026

ATO to stop accepting credit cards as payment method after 30 November 2026 The Australian Tax Office ( ATO ) has announced it will stop accepting credit cards as a payment method after 30 November 2026. The move follows after the Reserve Bank of Australia’s ( RBA ) Review of Merchant Card Payment Costs and Surcharging, where the RBA concluded that “it is in the public interest” to scrap surcharging for all designated card networks from 1 October 2026 (including EFTPOS, Mastercard, and Visa). It said that as a government agency, the ATO has decided it would not be appropriate for the cost of credit card merchant fees to be transferred to the community. The ATO recognises that some taxpayers currently rely on credit card payments to manage their tax payments and understands this change may require some adjustments. The ATO is writing directly to those who currently have a payment plan linked to a credit card to explain the changes and outlining the steps they need to take. There are alternative payment options available for taxpayers, including direct deposit, direct debit from a debit card, direct debit from an Australian cheque or savings account, Government EasyPay, in person at Australia Post, by mail, or international money remitter. The ATO said it is committed to helping taxpayers transition to alternative payment methods and will continue to support those experiencing financial hardship or other circumstances that make it difficult to meet their obligations. Alternative payment options for taxpayers are outlined at www.ato.gov.au/howtopay Taxpayers who need extra support are encouraged to visit www.ato.gov.au/supporttolodgeandpay , contact the ATO on 13 11 42 during business hours or speak with their registered tax professional.

Tax Alert - Draft legislation offers alternative to restructuring and avoid the 30% minimum trust tax

September 4, 2026

Yesterday, Treasurer Jim Chalmers released draft legislation to implement the key components of the 30% minimum trust tax on discretionary trusts announced in the Federal Budget during May 2026.