Change to Super Contribution Caps

March 4, 2021

As of 1 July 2021, the contribution caps for concessional and non-concessional contributions are set to increase due to indexation.

Concessional Contribution Cap Indexation

Concessional contributions are contributions made into a super fund before tax, and are taxed at a rate of 15% within your superannuation fund.  The concessional contribution cap is being increased from the previous existing cap of $25,000 per annum, to $27,500 per annum.  This change will come into effect from 1 July 2021.

Non-Concessional Contribution Cap Increase

Non-concessional contributions are made from your after-tax income, and are not taxed within your superannuation fund.  The non-concessional cap will also increase from 1 July 2021 from $100,000 per annum to $110,000 per annum.

The below table summarises the changes in both concessional and non-concessional contribution caps.

Concessional cap (from 1 July 2021)	Non-concessional cap (from 1 July 2021)
$27,500 pa.	Standard cap	$110,000 pa.
	Max contribution under bring-forward rule	$330,000

Changes to Bring-Forward Threshold and Cap

The bring-forward rule that allows members to make a contribution in one year, using three years’ worth of contributions in one year is also impacted by the change in non-concessional contribution cap. Previously, the bring-forward rule allowed members to contribute a maximum of $300,000 in one year. With the increase to the non-concessional contribution cap, this will now be updated to $330,000, provided that the member meets the requirements as seen in the table below.

There is also a change to the threshold at which non-concessional contributions can be made and the applicable percentage of the bring-forward rule that applies. As displayed in the table below.

Bring-Forward period thresholds (based on 30 June 2021 total super balance)	No. of years of cap that can be brought forward to current year	Standard non-concessional cap that applies in year	Max non-concessional cap that applies
Less than $1.48m	2 Years	$110,000	$330,000
At least $1.48m but less than $1.59m	1 Year	$110,000	$220,000
At least $1.59m but less than $1.7m	Nil	$110,000	$110,000
$1.7m or more	Nil	Nil	Nil

There are strict criteria that must be met before a non-concessional contribution can be made and the non-concessional contributions bring-forward rule is only applicable if the member is under 65 years old at any point during the year of the contribution. We recommend that you seek appropriate financial advice before making any contributions to super.

We’re here to help

For more information surrounding the new updates to super contributions and how they apply to you, contact our friendly team today on 07 3217 2477.