Contributions can generally be made if you are under age 75. More complex rules apply if you have used the ‘bring forward rule’ in the last two financial years. Your financial adviser can assist you with this.
Superannuation Guarantee rate has increased
The Superannuation Guarantee contribution rate increased from 11% to 11.5% on 1 July 2024, and will increase again to 12% from 1 July 2025. Also, from 1 July 2024, the quarterly maximum contribution base increased from $62,270 to $65,070. This is the maximum quarterly income amount on which Superannuation Guarantee contributions must be paid by your employer.
Preservation age increased to 60
The preservation age has increased from 59 to 60 on 1 July. This means the earliest that super may be accessed under ‘retirement’ has increased to age 60.
Other thresholds have gone up
Other key thresholds increased from 1 July, such as the income thresholds that determine eligibility for Government super co-contributions and the tax-free genuine redundancy amounts. These and other thresholds can be found at ato.gov.au (search for ‘Key super rates and thresholds’).
Other super considerations
- Superannuation Guarantee contributions for the April to June 2024 quarter were due by 28 July 2024. If these contributions were made to the super fund in July 2024:
- these are tax deductible in the 2024/25 financial year, even though the contributions relate to an employee’s ordinary time earnings in 2023/24, and
- these will count towards the employee’s concessional contribution cap in 2024/25.
- Salary sacrifice contributions may help eligible employees to increase the benefits of their tax savings in 2024/25. This is because salary sacrifice contributions are generally taxed in the super fund at 15%3 rather than to the employee’s marginal tax rate.
- Employers and employees need to ensure that salary sacrifice arrangements are entered into before the work is performed. Any salary, bonuses or entitlements that accrue before the arrangement is set up cannot be sacrificed into super.
1 Calculations takes into account the Low income tax offset and Medicare levy.
2 A higher concessional contribution cap may be available in 2023/24 or 2024/25 if the full cap amount isn’t utilised in the five previous financial years and other conditions are met.
3 An additional 15% tax will apply to all or part of the concessional contributions if the employee earns more than $250,000. Concessional contributions consist of Super Guarantee, salary sacrifice, and personal deductible contributions within the concessional cap.
Disclaimer: IOOF Employer Super is part of the IOOF Portfolio Service Superannuation Fund, ABN 70 815 369 818 (the Fund) and is issued by IOOF Investment Management Limited (IIML), ABN 53 006 695 021, AFS Licence 230524, as trustee of the Fund. IIML is part of the Insignia Financial group of companies comprising Insignia Financial Ltd ABN 49 100 103 722 and its related bodies corporate (Insignia Financial Group). The information contained in this communication is general in nature and does not take into account your employees’ objectives, financial situation or needs. Because of that, before acting on any of this information your employees should consider whether it is appropriate to their objectives, financial circumstances and needs. We recommend your employees obtain financial advice tailored to their own personal circumstances. Your employees should not rely on this information to determine their personal tax obligations. We recommend your employees consult a registered tax agent for this purpose. It is recommended that you consider the relevant IOOF Employer Super Product Disclosure Statement (PDS) before you make any decisions about your superannuation or insurance. A Target Market Determination (TMD) is also available for consumers to better understand products. You can obtain the latest copy of the PDS (or other disclosure documents) and TMD by calling us on 1800 913 118 or by searching for the applicable product on the website at ioof.com.au Insurance cover is provided through policies issued by the Insurer (TAL Life Limited) to IIML as policy owner and the insurance is subject to eligibility requirements, terms, conditions, exclusions and limitations set out in the Insurer’s policy document. Subject to super law, the final authority on any issue relating to an employee’s account is the Fund’s Trust Deed, and any applicable participation agreement and insurance policy, which govern an employee’s rights and obligations as a member. The information on insurance cover is a summary only of the terms and conditions applying to the insurance cover. To the extent there is any inconsistency with the terms of the insurance cover provided by the insurer, the terms of the insurance policy will prevail. While care has been taken in the preparation of this information, IIML nor any member of the Insignia Financial Group accept responsibility for any loss or liability incurred by you in respect of any error, omission or misrepresentation in the information in this communication.