Your 30 June ‘super’ checklist

With the end of the current financial year fast approaching, time is running out if you’re planning to boost your super balance before 30 June.

 

How can I contribute to my super?

There are two ways you can add to your super: from your before-tax income or from your after-tax income.

Before tax

Includes super guarantee (SG), salary sacrifice , and personal contributions that you claim a tax deduction for. These are also known as concessional contributions. The combined amount of concessional contributions you can make in a year is $30,000.

 After tax

Includes spouse contributions, and personal contributions that you don’t claim a tax deduction for. These are also known as non-concessional contributions. The combined amount of non-concessional you can make in a year is $120,000.
How is it taxed?

When you or your employer make a contribution to your super from your before-tax income, it’s taxed at 15%. There are a few exceptions to this for people with very low or very high incomes.

 How is it taxed?

If you or your spouse make a contribution to your super from after-tax income, you don’t pay any contributions tax on it. This is because you’ve already paid income tax on that money.

 

 

Types of contributions

Personal contributions

Are when you use some of your after-tax income or savings to make an additional contribution to your super.

You can generally claim a full tax deduction for some or all of your contribution as long as you’re younger than 67. This will reduce your taxable income and the amount of tax you pay. You’ll need to send a form called Notice of intent to claim a tax deduction to your super fund and wait for their acknowledgement before you can claim as a deduction.

 

Salary sacrifice

You can arrange for your employer to make additional super contributions on your behalf in return for giving up some of your before-tax income. These are known as ‘salary sacrifice’ contributions.

Salary sacrifice contributions are generally only taxed at 15%, while the tax rate you pay on your income can be as high as 47% (including Medicare levy), depending on how much you earn. That makes super an extremely tax-effective investment. Even if you’re a high-income earner and have to pay extra tax on your contributions, the tax savings are still significant.

 

Government co-contribution

If you’re an employee, have annual income of less than $60,400 (for the 2024-25 financial year), and you make a personal contribution to super that you don’t claim a tax deduction for, you may be eligible to receive a government co-contribution.

The government will pay up to $500 per year into your super, depending on your income and the amount of your contribution. You don’t need to complete any forms or notify your super fund—it will automatically calculate and paid into your super after you lodge your tax return.

 

Spouse contribution

It’s possible to make a contribution to your spouse’s super from your after-tax income or receive a contribution to you super from them. Sometimes couples do this when one of them isn’t working, or if one person earns more than the other.

The person that makes the contribution may be able to claim a tax offset of up to $540 for the contribution, depending on their spouse’s income and the amount of the contribution. You can’t claim a tax deduction for a spouse contribution.

 

Downsizer contribution

If you’re 55 or over and you sell a home that you’ve owned for at least 10 years, you may be able to contribute up to $300,000 of the proceeds from the sale of your home into your super.

The contribution is completely tax-free when you deposit it into your super, and you can also withdraw it tax-free later on. What’s more, downsizer contributions don’t count towards the other contributions caps. So it’s a great way to top up your retirement savings.

To make a downsizer contribution, you need to fill out the ATO’s Downsizer contribution into super form and send it to your super fund before making the contribution and within 90 days of selling you home.

The eligibility rules and impacts on your Age Pension entitlements for downsizer contributions can be complicated, so it’s best to talk to your Pinnacle Adviser first.

 

How much extra should I contribute to super?

You may choose to make regular additions via salary sacrifice or make a larger one-off contribution if you have some money to spare, such as savings or an inheritance.

Just remember the trade-off is that once you put money into your super account, you generally can’t take it out again until you retire. So make sure it’s money you can afford to part with.

 

Making a larger before-tax (concessional) contribution

If you haven’t used your concessional contributions cap in a  previous financial year, it may be possible to carry across the unused amount for up to five years. This would allow you to make a larger concessional contribution.

 

Making a larger after-tax (non-concessional) contribution

Depending on your age and super balance, you may be able to bring forward future years of your non-concessional contributions cap to make a large contribution in a single year.

 

Navigating super and tax can be complex. Especially when it comes to super caps and ensuring you don’t breach those super caps.

If you would like more help with your super strategies, please reach out to your Pinnacle Adviser today.

 

“Pinnacle always provides an excellent service. [My Advisor] has provided outstanding support to my two daughters and I since the death of my husband in August 2020. I would be happy to recommend this service to others.”
Margaret NRetired
“The Pinnacle team has guided the management of our financial circumstances for over 20 years, successfully navigating at least 3 significant economic cycles. Services have been rendered with total integrity and focus on our personal aspirations. During this time we have greatly appreciated the extension of PWM resources to assist a number of family members responding to particular situations along their personal lives' journeys.
Trevor & Carolyn IConsultants
“Pinnacle Wealth Management, who most importantly created a sound financial future for our comfortable retirement, go way beyond being a financial advisor, providing support to us and our children, as their needs have changed, at a strongly personable level. Their client focus is exemplary.”
Barry TRetired Accountant
“We have been Pinnacle clients for many years and have always found their advice to be considered relevant. The administration team is professional, courteous and timely. No hesitation in recommending the Pinnacle Team.”
Damien WRetired Head of Commercial Banking
“A friend recommended Pinnacle Wealth Management to me, having worked with them on his mother's behalf for many years. I'm so grateful to him - my Financial Advisor is brilliant, totally approachable, not as I'd imagined! I now have much greater clarity about financial management and greater peace of mind. For my money, they're the best financial planners in Adelaide.”
Jackie HCommunications Consultant
 “We are long term friends of [Pinnacle Wealth Management] having been clients since its inception. We have appreciated the professional advice and also the care and friendliness of [our advisor] and staff."
Ian WRetired
"We have been clients at [Pinnacle Wealth Management] for about 20 years. It has been a very enjoyable and profitable time for us. We have been safely steered through the GFC, both our retirements and various other major events that have shaped the nature of financial planning in our world. Through the entire time we have been delighted with the care and careful management of our funds through the leadership of [our now retired advisor] and the friendly and efficient support of all the ancillary staff. He has become a personal friend as well as the person whom we trust implicitly to handle our portfolio and to give us sage and pertinent advice on many areas of our concern. We will miss his presence but we are sure that he has chosen well with [our new advisor], and we look forward to forging a similar relationship with him.'"
Ray & Lyn HRetired
"We have been clients of [Pinnacle Wealth Management] since the inception of the business, about 20 years ago. Overall, we have been very pleased with the long-term handling of our financial affairs, the financial strategy implemented and the regular reviews to make sure we remain on track to achieve our goals. This includes regular informative communications. It has been great to receive sound advice and personalised service, tailored to our needs, covering many different tasks. When an emergency occurred, the excellent and swift service we received from the staff [at Pinnacle] was greatly appreciated. We wholeheartedly recommend [Pinnacle Wealth Management] as a Financial Adviser."
Kelvin & Melanie TConsultant
"My association with [my advisor] began many years ago, with a requirement to diversify my portfolio from bricks and mortar to Australian and International equities. At that time [my advisor] worked for another financial services business. I had no hesitation in following [my advisor] to Pinnacle. [My advisor] has the qualifications, but it is his experience and guidance that have been the founding safeguard for my family and I throughout the varying market conditions. [My advisors] expertise and guidance throughout the years has provided us in achieving our goals along with our family needs. His innovation and tailored strategies have kept us on track in reaching our desired endgame.
Tony SMaintenance
Book a free consultation

Pinnacle Wealth Management Advisors are Authorised Representatives of
Pinnacle Dealer Services Pty Ltd, ABN 53 630 368 302, AFS Licence number 513743.

© 2024 Pinnacle Wealth Management
Website & Commercial Photography by Drawcard
Words by Jacqui