WEEKLY E-MAIL
SUPERANNUATION STRATEGIES FOR END OF FINANCIAL YEAR
By Denise Slattery
Concessional and Non Concessional Contribution
Need a tax deduction and want to build your super? Make sure you maximise your concessional contributions before 30 June 2021.
What are concessional contributions?
Concessional contributions are those that are made into superannuation on a pre-tax basis. This includes your mandated employer contributions, any salary sacrifice contributions and any personal contributions deposited into superannuation, for which a tax deduction is claimed.
The concessional contribution limit
The concessional contribution cap is $25,000 per annum for the 2020/21 Financial Year. This includes the 9.5% superannuation guarantee contribution.
The concessional contribution limit for the 2021/22 Financial Year will increase to $27,500 after 1 July 2021.
Carrying forward concessional contributions
Another opportunity to maximise your concessional contributions is available to individuals with less than $500,000 in super at the end of a Financial Year, to utilise the unused portions of their concessional caps from previous years (up to five years’ worth).
This unused carried forward cap amounts start from 1 July 2018 (the 2018/19 Financial Year), meaning the 2019/20 is the first Financial Year individuals can take advantage of unused cap amounts from the previous Financial Year.
Advantage of concessional contributing to super
The primary advantage of making concessional contributions is the difference in the amount of tax paid. Every dollar that is concessionally contributed into superannuation is taxed at 15%, rather than at your marginal tax rate.
The taxation advantages, at each marginal tax rate, are summarised in the table below:
| Taxable Income | Marginal Tax Rate (including Medicare Levy) | For $1,000 in Salary, you receive | For $1,000 your super fund receives, and a tax deduction is claimed | Extra Benefit |
| $45,001 to $120,000 | 34.5% | $655 | $850 | 29.77% |
| $120,001 to $180,000 | 39.0% | $610 | $850 | 39.34% |
| $180,001 to $250,000 | 47.0% | $530 | $850 | 60.37% |
| $250,000+ | 47.0% | $530 | $700 | 32.07% |
*Individuals with income above $250,000 per annum for Division 293 tax incur an additional 15% tax on concessional contributions.
Other things to be considered:
If you are thinking of increasing your concessional contributions before 30 June 2021, several factors need to be considered. These include:
- How much has already been concessionally contributed into super? If you are close to your contribution limit, then there may not be room for you to make additional contributions.
- What your taxable income is. All concessional contributions are taxed at 15%, upon receipt by the superannuation fund. If your income is below $18,200, your marginal tax rate is zero. Therefore paying the 15% tax on concessional contributions into super is unnecessary. Similar to if your income is between $18,200 and $45,000, where your marginal tax rate is 19% (excluding the Medicare Levy). If your income is above $45,000, then there is a significant tax advantage to making additional concessional contributions into super.
- Accessibility. Remember there are restrictions around when superannuation funds can be accessed.
- Ensuring appropriate notification is given to the superannuation trustee. Appropriate notice must be provided to the trustee(s) of your super fund, where a personal concessional contribution is made, and within the required time limits.
Action required
If you believe that you have scope to increase your concessional contributions, the required actions need to be taken ASAP.
If you need assistance in understanding how much has already contributed, and how much more you need to contribute to reach the $25,000 cap, please contact us.
Denise Slattery
Senior Para-Planner
Authorised Representative No. 304356
If you have any questions or comments, please email me at denise@gfmwealth.com.au
Disclaimer: This document is not an offer or invitation to any person to buy or sell any interest in or deposit funds with any institution. The information here is of a generic nature, and does not take into account your investment objectives or financial needs. No person should act upon this information without firstly seeking competent, professional advice specifically relating to their own particular situation.
Copyright: © This publication is copyright. Subject to the conditions prescribed under the Copyright Act, no part of it may, in any form, or by any means (electronic, mechanical, microcopying, photocopying, recording or otherwise) be reproduced or transmitted without permission. Enquiries should be addressed to GFM Wealth Advisory.
17 Mar 2026
3 Mar 2026
23 Feb 2026