This article explains the different types of contributions to assist you to select the correct field in the member contribution event. For more information on the member contribution event in Class, please see Member Contributions.
- Government Co-Contributions And Low Income Super Tax Offset
- Downsizer Contributions
- COVID-19 Re-contribution
- 15 Years Exemption
- Retirement Exemption
- Personal Injury Election Amount
- Other Family and Friends
Contributions made to an accumulation account by an employer on behalf of an employee (the member) to meet superannuation guarantee, award or other obligations.
Amounts salary sacrificed in an arrangement where the employee agrees to forgo part of their future salary or wages in return for their employer providing a super benefit of similar value.
Contributions a member has made directly to the fund for which the member has claimed or can claim as a tax deduction.
Contributions a member has made directly to the fund of which the member has not claimed or cannot claim as a tax deduction.
Contributions made by a spouse.
Contributions made for a member who is under the age of 18 that are not made by the member or by (or on behalf of) the member's employer
Government Co-Contributions And Low Income Super Tax Offset
Government super payment of up to a maximum amount of $500 for those low or middle-income earners who make personal (after-tax) super contributions to the super fund
From the 2017–18 financial year, to be eligible for a co-contribution:
- the Total Superannuation Balance is less than the general transfer balance cap for that year
- the contribution that is made to the super fund must not exceed the non-concessional contributions cap for that year.
Low-income super tax offset
Effective 1 July 2017, eligible individuals with an adjusted taxable income up to $37,000 will receive a low-income super tax offset (LISTO) payment to their super fund. The LISTO payment will be equal to 15% of their total concessional (pre-tax) super contributions for an income year, capped at $500.
Low-income super contribution
For 2012–13 to 2016–17 financial years, if individuals earned $37,000 or less a year, they may be eligible to receive a low-income super contribution (LISC) payment directly into their super fund. The LISC is 15% of the concessional (before tax) super contributions the individual or their employer paid into the super fund during the 2012–13 to 2016–17 financial years.
From 1 July 2022, individuals aged 60 or over will be able to make multiple contributions to super of up to $300,000 from the proceeds of selling their main home residence. Prior to this, the member has to be 65 or older to make the downsizer contribution.
These contributions will not count towards the concessional or non-concessional contribution caps. The individual making the contribution will not need to meet the existing age restriction and work test and is unaffected by the total super balance of the $1.6m test.
Downsizer contribution will increase the accumulation of a member's tax-free component.
For a contribution to be a downsizer contribution in respect of an individual, the following conditions must be satisfied:
- The individual must be aged 60 years or older (from 1 July 2022) at the time the contribution is made;
- The contribution must be in respect of the proceeds of the sale of a qualifying dwelling in Australia
- The 10-year ownership condition is met;
- Any gain or loss on the disposal of the dwelling must have qualified (or would have qualified) for the main residence CGT exemption in whole or part;
- The contribution must be made within 90 days of the disposal of the dwelling, or such longer time as allowed by the Commissioner;
- The individual must choose to treat the contribution as a downsizer contribution and notify their superannuation provider in the approved form of this choice at the time the contribution is made;
- The individual cannot have had downsizer contributions in relation to an earlier disposal of the main residence.
A Downsizer contribution into super form needs to be completed and provided to the SMSF.
Individuals can now make re-contribution of COVID-19 early release super amounts they withdrew under the COVID-19 early release of super program without them counting towards their non-concessional contributions cap. These contributions can be made between 1 July 2021 and 30 June 2030.
The re-contribution will count towards the member's transfer balance cap, which applies when the member moves the super interest into the retirement phase. It will also count towards their total super balance when it is recalculated to include all the contributions on 30 June at the end of the financial year.
If choosing to make a COVID-19 re-contribution, the member will need to complete the Notice of re-contribution of COVID-19 Early Release amounts (NAT 75394) form. It is required for the member to provide this form to the super fund before or at the time of making the re-contribution. The super fund will then need to report this to the ATO.
Class has built the functionality for the super fund to generate the re-contribution file and report this to the ATO via Online Services for Tax Agent > Bulk Data Exchange (BDE). Please refer to How to generate and lodge COVID-19 Re-contribution file.
15 Years Exemption
When the contribution made to the Super are:
- capital proceeds from the sale of an asset that qualifies for the small business 15-year exemption, or
- capital proceeds from the sale of an asset that would otherwise qualify for the small business 15-year exemption, but do not because:
- the asset was a pre-CGT asset
- there was no capital gain on the disposal, or
- the 15-year holding period was not met because of the permanent incapacity of the person (or a controlling individual of a company or trust).
These contributions are excluded from the non-concessional contribution cap up to the super CGT cap amount. A lifetime limit of $1 million (indexed annually from 2008-09) super CGT cap applies. The lifetime super CGT cap is currently $1.445 million for 2017-18.
Contributions using the capital proceeds of the sale of certain small business assets to super where the retirement exemption applies.
The small business retirement exemption amount can include up to $500,000 of capital gains that are disregarded under the CGT small business retirement exemption.
Personal Injury Election Amount
Contributions from personal injury payment amounts that have been elected to be excluded from the non-concessional contribution cap. The amount must arise from:
- A structured settlement payment
- an order for a personal injury payment
- a lump sum workers compensation payment
Other Family and Friends
Contributions made by any of the following on behalf of a member:
- a spouse living separately and apart on a permanent basis from the member
- a parent, child, other relatives or friend (where the member is 18 years or older)
- any other third party (other than an employer or a spouse who is living with your member)
Amount transferred from a foreign super fund or scheme that exceeds the amount that was vested in the member, at the time of transfer.
Amount transferred from a foreign super fund or scheme that is not included in the assessable income of your fund.
Learn to process Member Contributions