Besides your employer contributions, you can also contribute extra to your super
However, there are limits to how much you can contribute and these are referred to as Contribution Caps. There are different limits to the caps which depend on the type of contributions made into your super fund, these are explained in-depth below.
Concessional contributions are before tax contributions. They include employer contributions, salary-sacrificed contributions and personal contributions for which you can claim a tax deduction. The maximum concessional contributions that can be made are $25,000.
Non-concessional contributions are after tax contributions. These contributions are contributions you make after tax has been taken out of them and for which you are not allowed to claim an income tax deduction. The maximum amount of non-concessional contributions that can be made is $100,000 per year or $300,000 over a three-year period which commences in the first year in which the non-concessional contributions exceed $100,000.
From 1 July 2017, the non-concessional contributions cap is nil for individuals with total superannuation balances of $1.6 million or more at the end of the previous income year.
Visit the Australian Taxation Office website for more information on contribution caps.
Disclaimer: The information contained in this document is provided for educational purposes only, is general in nature and is prepared without taking into account particular objective, financial circumstances, legal and tax issues and needs. The information provided in this article is not a substitute for legal, tax and financial product advice. Before making any decision based on this information, you should assess its relevance to your individual circumstances. While SMSF Association believes that the information provided in this article is accurate, no warranty is given as to its accuracy and persons who rely on this information do so at their own risk. The information provided in this bulletin is not considered financial product advice for the purposes of the Corporations Act 2001.