Contributing to Super
Contribution Limits
From 1 July 2007, limits on concessional contributions and non-concessional contributions apply.
Concessional Contribution Limits
The limits on concessional contributions are as follows:
| |
age<50 |
age 50 or more* |
|---|---|---|
| 2008/2009 | $50,000 |
$100,000 |
| 2007/2008 | $50,000 |
$100,000 |
*Members who are at least 50 on 30 June in the relevant year
The lower limit ($50,000) will increase with indexation in some future years. The higher limit for members over 50 will cease at 30 June 2012 and will not be indexed.
Members must monitor the level of concessional contributions being made to their superannuation plan(s). Neither the Plan or the employer can do this on behalf of members. The Plan can accept contributions above the limits.
Any concessional contribution limits above the limit will be subject to contributions tax at the rate of 31.5% (in addition to the 15% tax that is paid by the Plan). A notice of excess contributions will be provided by the ATO, requiring members to pay this additional tax. Members will have the option of either making a withdrawal from their superannuation account to meet this payment, or paying it directly to the ATO themselves.
Excess concessional contributions may not be refunded by the Plan.
Any concessional contributions above the limit will count against the non-concessional contribution limits (refer below).
Non-Concessional Contribution (NCC) Limits
The NCC limit is 3 x the standard concessional contribution limit. Therefore, for the 2008/09 financial year, NCCs are limited to $150,000 for all members. This limit will increase with indexation in later years.
If you are under 65 on 1 July in a financial year, you can bring forward up to 2 years NCCs. This would give you a limit of $450,000 for the 2007/08 financial year. If you bring forward 2 years of NCCs, this reduces the amount of NCCs you can make in the following two years.
Any NCCs above these limits will be taxed at the rate of 46.5%. This tax will be payable by the Member who must withdraw this amount from their account balance. It is therefore important that you monitor your NCCs against this limit to minimise the amount of extra tax that could become payable. The Plan will not do this for you and can accept some contributions above your limit.
