min read
· Posted on
February 21, 2024

What’s the deal with superannuation and taxes?

Wondering how superannuation tax works? You’ve got questions, we’ve got answers.

What's the key learning?

Look, we know no one wants to think about their taxes… or their superannuation… but what if we told you that the combo of super + tax is actually quite exciting… Because you can actually pay less tax. Yep, you heard me.

Do my super contributions get taxed?

Yes, they do. But not that much. Put simply, super contributions from your employer are taxed at a rate of only 15%. For most people, that’s less than your income tax rate.

Now if you’re thinking about making additional voluntary super contributions or salary sacrificing, the tax situation might change a liiittle.

But here’s the tricky part, the super contributions tax sitch for non-concessional contributions is a bit different. Non-concessional contributions are contributions into your super that have already been taxed. 

What if I’m a low income earner?

If you’re a low income earner making $37000 or less each year, the government will actually give you a refund to compensate for the 15% tax you’ve paid on your super. It’s called the low income super tax offset and you don’t need to do anything to get it except make sure your super fund has your tax file number (TFN).

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