Key takeaways
- Contributions fall into two broad groups: concessional (before tax) and non-concessional (after tax).
- Each group has an annual cap, and exceeding it can create extra tax.
- Other contribution types include spouse contributions, the government co-contribution, and downsizer contributions.
- A contribution only counts for a year if it is received in the fund's bank account by 30 June.
Contributions are how new money enters your SMSF. There are several types, and the rules differ for each, but they all sort into two families: concessional (before-tax) and non-concessional (after-tax) contributions. Getting the type and timing right matters, because the caps and tax treatment hinge on it.
Concessional (before-tax) contributions
These are contributions for which someone claims a tax deduction. They include compulsory employer super (the super guarantee), salary sacrifice, and personal contributions you claim as a deduction. They are taxed at the concessional rate inside the fund and count against the annual concessional cap. See concessional contributions.
Non-concessional (after-tax) contributions
These come from money you have already paid tax on, so they are not taxed again on the way in. They count against a separate, larger annual cap, and a bring-forward rule can let you contribute several years' worth at once. See non-concessional contributions.
Other contribution types
- Spouse contributions: contributing to your spouse's super, potentially with a tax offset.
- Government co-contribution: for lower-income earners who make personal after-tax contributions.
- Downsizer contributions: for eligible older Australians who sell a long-held home.
Eligibility, ages and amounts for these are set by the ATO and change over time, so confirm current rules before relying on them.
Caps and age rules
Both contribution families have annual caps, which are indexed and can change between years. There are also age and work-related conditions on some contribution types, particularly for people aged 67 to 74. Because the figures move, we point to the ATO's current contribution caps rather than quoting a number that may date.
Timing is everything at year end
A contribution counts in the financial year the fund actually receives it, not when you send it. A transfer made on 30 June that lands on 1 July counts for the next year. If you are managing caps, allow clear time for the money to reach the fund's account.
Frequently asked questions
- What is the difference between concessional and non-concessional contributions?
- Concessional contributions are before-tax (someone claims a deduction) and are taxed in the fund. Non-concessional contributions are after-tax and are not taxed again on the way in. They have separate annual caps.
- When does a contribution count for the financial year?
- When the fund receives it. A contribution counts in the year the money lands in the fund's bank account, so a transfer made on 30 June that clears on 1 July counts for the following year.
- Can I still contribute to super after I turn 67?
- Often yes, but some contribution types have age and work-related conditions for people aged 67 to 74. The rules change over time, so check the current ATO position for your age and contribution type.
