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What’s changing from 1 July 2023 for Superannuation

Concessional and non-concessional contribution caps

For the 2024 financial year the concessional contribution cap will continue at $27,500. Concessional contributions are contributions made into your super fund before tax such as superannuation guarantee or salary packaging.

The non-concessional cap will remain at $110,000 per annum for the 2024 financial year. Non-concessional contributions are after tax contributions made into your super fund.

The bring forward rule enables those under the age of 75 to contribute three years’ worth of non-concessional contributions to your super in one year. For the 2024 financial year, you will be able to contribute up to $330,000 in one year. Total superannuation balance rules will continue to apply.

1 July 2023 onwards
Total Superannuation Balance (TSB) Contribution and bring forward available
Less than $1.68m $330,000
$1.68M -$1.79m $220,000
$1.79M – $1.9m $110,000
Above $1.9m Nil

Transfer balance cap – why you will have a personal cap

The transfer balance cap (TBC), as the name suggests, limits how much money you can transfer into a tax-free retirement account. From 1 July 2023, the general TBC will increase from $1.7m to $1.9m but not everyone will benefit from the increase.

There will not be a single cap that applies to everyone. Instead, every individual will have their own personal TBC of between $1.6 and $1.9 million, depending on their circumstances.

If your superannuation is in accumulation phase before 1 July 2023, that is, you have not started taking an income stream (pension), then your cap will be the fully indexed amount of $1.9m.

However, if you have started taking an income stream – you have retired or are transitioning to retirement – then your indexed TBC will be calculated proportionately based on the highest ever balance of your account between 1 July 2017 and 30 June 2023. The closer your account is to the $1.9m cap, the less impact indexation will have. For anyone who reached the $1.6m cap at any time between 1 July 2017 and 30 June 2021, or the $1.7m cap at any time between 1 July 2021 and 30 June 2023, indexation will not apply as you have utilised the full amount of your cap. For example, if you are transitioning to retirement and drawing a pension, and your highest ever balance in your retirement account was $1.2m, then indexation only applies to $400,000 (the $1.6m cap less your highest very balance). In this case, your new personal TBC will be $1,625,000 after indexation.

The Australian Taxation Office (ATO) will calculate your personal TBC based on the information lodged with them (this will be available from your myGov account linked to the ATO). If your superannuation is in retirement phase, it will be very important to ensure that your Transfer Balance Account compliance obligations are up to date. For Self-Managed Superannuation Funds (SMSFs), it is essential that you let us know about any changes that impact on your transfer balance account, for example if a member of your fund retires.

The total super balance caps to utilise the spouse contribution offset and the government co-contribution will also be lifted to $1.9m in line with indexation.

Minimum superannuation drawdown rates

There are no changes to the minimum pension withdrawals from the 2023 financial year rates, as such the rates are the same for the 2024 as per the following table.

Age Default minimum drawdown rates
Under 65 4%
65-74 5%
75-79 6%
80-84 7%
85-89 9%
90-94 11%
95 or more 14%

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