How to Claim Tax Deductions for Super Contributions?

As of 1st July 2017, more Australians will be able to claim tax deductions for personal super contributions. This is possible when an individual makes the super contribution, rather than an employer. In the main this measure will assist:

  • Individuals who are self-employed,
  • Partly employed, and
  • Employees whose jobs do not provide salary sacrificing

What Super Contributions are Tax-Deductible?

You can generally make 2 types of superanuation contributions:

  • Non-concessional (after-tax) contributions
  • Concessional (before-tax) contributions, which include; Superannuation Guarantee Contributions (SGC), Salary Sacrifice, and Tax-Deductible Member Contributions (previously used predominately by the self-employed).


Prior to 1 July 2017, you could claim a tax deduction for super contributions if you were self-employed, not employed, or met the 10% income test rule. If you were an employee you had limited options to make a claim, however, you could get a similar tax benefit by making salary sacrifice contributions.

From 1 July 2017, the 10% income test rule will no longer apply, and full-time employees can now make tax-deductible super contributions.

Under current rules individuals can make concessional contributions of up to $25,000 a year. To be eligible, you need to be under 75 years of age and if you are under 18, you can only claim when your income is generated from gainful employment.

Is Claiming this Tax Deduction Worth it?

In general, most gainfully employed individuals will be better off contributing more money to super, from a tax perspective, than not. However it’s important to remember that concessional contributions are subject to a 15% tax within a super fund. This means claiming this tax deduction may not be effective for people who pay less than 15% tax on their income. Furthermore, high-income earners will also be subject to an extra 15% tax.

Individuals are now classed as high-income earners if their ‘income for surcharge purposes’ is more than $250,000 a year (this used to be $300,000). This means a 30% tax rate will apply for Australians earning more than $250,000 instead of the normal 15% rate.

If you are looking to maximise your saving capacity for retirement, or you want to speak with someone who can help educate you on pre-retirement planning, pension arrangements and investment strategies, contact United Global Capital today for a no cost, no obligation consultation on 03 8657 7640 or email to learn more.

The information contained in this article is General in nature and has been prepared without taking into account your objectives, financial situation and needs. When assessing any investment you should also consider that past performance is not a reliable indicator of future performance

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