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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