Contributing to Super

Defined Benefit Members

Defined benefits are funded from member and employer contributions.

The rate of member contributions is usually prescribed. For example, members in Division 3 contribute at the rate of 5% of salary. Member contributions are made from after-tax pay and hence are counted as Non-Concessional Contributions. Some employees are eligible to make their member contributions from pre-tax salary.

The remainder of the defined benefits are funded by employer contributions. The cost of these benefits is not known in advance because of the nature of the defined benefits (which are linked to salary at exit). Therefore, employer contributions are determined by the Actuary as those necessary to provide the defined benefits for members. Assessment of these contribution rates is made every three years, and the last review was undertaken as at 30 June 2005.

In accordance with the legislation the Actuary will calculate a Notional Taxed Contribution rate which will reflect the value of the defined benefits. These contributions will also count as concessional contributions. Defined benefit members will be advised of their levels of concessional contributions during the year.