Keep track of your super contributions

Super can be a tax-effective way to save for retirement. However, if you contribute more than the government-mandated caps on concessional (before-tax) contributions, you may be charged extra tax.

The good news is only 8% of UniSuper members employed in the University sector breached the caps last year, but it pays to be aware of the cap and what happens if you exceed it.

Concessional contributions limits

Concessional contributions are taxed at 15% up to the cap and include employer and salary sacrifice contributions. The concessional contributions cap for members is – for the 2019-20 financial year – $25,000 (with notional amounts applying for Defined Benefit Division (DBD) members). For those who exceed the cap, the tax payable on any contributions above the cap is generally the difference between the 15% contributions tax and your marginal tax rate plus additional charges and interest levied by the ATO.

If you exceed the cap, the ATO will write to you with details about any tax payable. It’s important to note that if you have an accumulation account or an accumulation component to your defined benefit, you can apply to release up to 85% of the excess amount from your accumulation super fund.

Tips to take control of your contributions:

• Learn more: Read more about contributions caps at unisuper.com.au/caps.
• Keep track of your contributions: Check your concessional contributions with your super fund. If you’re a UniSuper member, log in to your online account to see how you’re tracking.
• Get some help: If you’re a UniSuper member, you can make an appointment to see your on-campus consultant at unisuper.com.au/campusbookings or call 1800 823 842.

UniSuper has provided this information to help us better service our employees. UniSuper Ltd (ABN 54 006 027 121, AFSL 492806) is the trustee of UniSuper (ABN 91 385 943 850). UniSuper Management Pty Ltd (ABN 91 006 961 799, AFSL 235907) operates UniSuper Advice.

Article courtesy UniSuper.