Super changes and opportunities for you and your employees 2025/26

Effective Date: 2025-06-19 03:48

As we get ready to kick off the new financial year, there are some important changes to superannuation that may impact you and your employees. Here’s an overview of what’s changing (or proposed to change) from 1 July and some key super opportunities.

Key changes

Superannuation Guarantee rate is increasing

The Superannuation Guarantee (SG) contribution rate will increase to 12% on 1 July 2025. Employees should review existing salary sacrifice agreements for 2025/26 to take into account the SG increase. Also, the quarterly maximum contribution base on which employers must pay SG contributions will reduce from $65,070 to $62,500, to allow for the SG rate increase.

Transfer balance cap is increasing

From 1 July 2025, the general transfer balance cap (TBC) – that limits how much super can be transferred into tax-free retirement phase pensions over a person’s lifetime – will increase from $1.9m to $2m.

Employees will benefit from the full TBC increase if they have never started a retirement phase pension. This would be most employees, as they would need to have reached age 60 and retired (or met another full condition of release) to start a retirement phase pension.

While some employees may have started a transition to retirement pension with their super, these are not retirement phase pensions unless the employee is aged 65 or over or met a full condition of release before reaching age 65 and notified their superannuation fund.

Some total super balance thresholds are increasing

The total super balance (TSB) thresholds that determine eligibility to make non-concessional super contributions (NCCs) will increase (see table below). This will allow more opportunity to make NCCs for those with higher super balances. For example, to make NCCs of up to $360,000 in 2025/26, the TSB on 30 June 2025 can be up to $1.76m (an increase of $100,000 from $1.66m in 2024/25). Other conditions apply.

NCC caps	TSB (30 June 2024)	TSB (30 June 2025)
$360,000 (three-year brig forward)	< $1.66m	< $1.76m
$240,000 (two-year bring forward)	$1.66m to < $1.78m	$1.76m to < $1.88m
$120,000 (one-year bring forward)	$1.78m to < $1.9m	$1.88m to < $2m
Nil	$1.9m or more	$2m or more

Higher taxes for balances over $3m (proposed, but not law yet)

The Government has proposed that individuals with a total super balance of more than $3m on 30 June 2026 will pay an additional 15% tax on a portion of investment earnings relating to the amount exceeding $3m.

The Government introduced proposed legislation to Parliament in 2024 to make this change, but the proposed legislation lapsed when the election was called. To implement the change, the Government will need to reintroduce and pass the legislation in Parliament. The new Parliament is expected to meet for the first time on 22 July 2025.

Key super opportunities

A new financial year presents a new opportunity to make additional super contributions, subject to the contribution caps and other eligibility criteria. Some ways your employees may be able to boost their super are summarised in the table below.

Strategy	How to use it	Possible benefits
Get more from salary or bonus by salary sacrificing into super	Arrange to contribute pre-tax salary into super as part of a salary sacrifice agreement	Pay less tax on salary or bonus Increase retirement savings
Add to super and claim a tax deduction	Make an after-tax super contribution and notify the fund how much is to be claimed as a tax deduction	Pay less tax on income Increase retirement savings
Split super contributions with spouse	Split certain pre-tax super contributions made in the prior financial year with the spouse	Manage super balances more effectively as a couple
Convert non-super savings into super savings	Make an after-tax super contribution	Pay less personal tax on investment earnings Increase retirement savings
Get a super top-up from the Government	Make an after-tax super contribution	Low income earners receive a Government co-contribution of up to $500 per year Increase retirement savings
Boost spouse’s super and reduce tax	Make an after-tax contribution into an eligible spouse’s super account	Receive a tax offset of up to $540 per year Increase your spouse’s retirement savings

Disclaimer:

This communication is issued by IOOF Investment Management Limited (IIML) (ABN 53 006 695 021, AFSL 230524). IIML is a 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). IOOF Employer Super is issued by IIML as Trustee of the IOOF Portfolio Service Superannuation Fund ABN 70 815 369 818.

The information is of a general nature only and has been prepared without taking into account any of you or your employees’ objectives, financial situation and needs. Before making a decision based on this information, you and your employees should consider the appropriateness of the information, having regard to their objectives, financial situation and needs. You and your employees should obtain a Product Disclosure Statement (PDS) relating to your product and consider it before making any decision about whether to acquire or continue to hold the product. Target Market Determinations (TMDs) where required for relevant products have to be available for consideration by distributors/members/investors. A copy of the PDS (or other disclosure documents) and TMD are available upon request by phoning 1800 913 119 or by searching for the applicable product on our website www.ioof.com.au

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.