Missed opportunities to make super contributions

Superannuation comes with some great tax breaks and like anything there are rules to follow. The two main types of contributions are concessional and non-concessional contributions. If you miss out on maximising your contributions, in some cases you can catch up later.

There are several different types of super contributions with different caps. The main two types are:

Concessional contributions

These contributions are generally made on your behalf. For example, your employer makes compulsory contributions under the superannuation guarantee, of 10.5% of an employee's ordinary time earnings when an employee is over 18 years, or under 18 years and works over 30 hours a week. This rate is legislated to rise to 12% by 1 July 2025. Employees can also make extra contributions or salary sacrifice contributions in return for a lower cash salary. Another type of concessional contribution is when you make a contribution using your own money and claim a personal tax deduction.

If for some reason you miss out on contributing as much as possible to your super in a particular year you can ‘catch up’ and use any concessional cap amounts you didn’t use at the time. This is available to people who have less than $500,000 in super.

The cap of concessional contributions is currently $27,500 each year.

Non-concessional contributions

These are contributions made into super and not included in the fund’s assessable income. The most common is personal contributions made from your own money for which you don’t claim a tax deduction. They also include contributions your spouse makes for you. The non-concessional contribution cap is currently $110,000. However if a member’s total superannuation balance is above $1.7M on 30 June of the prior financial year their non-concessional contribution cap is nil.

There is also the ability to access up to three years of non-concessional contributions through the Bring Forward Rules. For funds with less than $1.48m you can contribute $330,000 which is 3 years bring forward. Funds between $1.48m and $1.59m you can bring forward 2 years which is $220,000 and for funds between $1.59m and $1.7m $110,000 or just one year.

If you have any questions or would like to know more about superannuation contribution rules and what you can do please contact Heather Locker, our SMSF Specialist at Sullivan Dewing.