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How to make extra contributions to your super

Published 1 July 2021

Approaching retirement or simply looking at your options for investing additional income? You might want to consider making extra contributions to your super.

The Association of Super Funds Australia (ASFA) has previously stated that singles will need $545,000 in retirement savings, while couples will need $640,000 in order to have a comfortable retirement. Making extra contributions to your super can help you achieve that goal.

“Retirement can stretch over three decades or more and retirees need to be prepared for and invest for the long term,” says ASFA CEO Dr Martin Fahy.

The earlier you start investing in your super, the more opportunity there is to build a tidy super balance thanks to the interest that compounds each year. This is especially important for women, who generally have lower super balances than men. Making extra contributions now can help boost women’s financial security throughout retirement.

Here’s what you need to know about adding extra money to your super.

How to make extra contributions

If you’re looking to put more money into your super on top of the mandatory Superannuation Guarantee payment (10% of your ordinary time earnings) from your employer, you have a couple of options: pre-tax (also known as 'concessional') contributions and post-tax (also known as 'non-concessional') contributions. 

Pre-tax contributions

A pre-tax superannuation contribution lets you put a portion of your salary into your super before income tax is applied to your pay. The compulsory super contributions made by your employer are one form of pre-tax contributions. 

Salary sacrifice salary to your super

Salary sacrificing is a relatively common method of making extra pre-tax super contributions. It involves forming an arrangement with your employer to have a portion (in addition to the 10% super guarantee payments) of your income paid into your superannuation account.

One advantage of salary sacrificing is that it may reduce how much tax you pay. The salary that goes into your super is generally taxed at 15% however you might pay an additional 15% tax if you’re a high income earner. A total tax of 30%, if you’re a high income earner, may very well be less than your usual income tax rate. Plus, the more super you put into your account, the more you’ll be reducing your taxable income. 

Post-tax contributions

An after-tax or non-concessional superannuation contribution is a contribution that comes out of your take-home pay. For example, your wage after income tax has been applied.

After-tax superannuation contributions are not taxed in your superannuation fund and any contributions you make will be paid out tax-free when you access your super in the future.

Personal contributions

You might have some spare cash or you may have received a bonus at work – whatever the case, you can easily contribute this money to your super account to help improve your retirement outlook. 

ASFA CEO Dr Martin Fahy echoes this idea, saying, “As tempting as it can be to splurge your tax refund on short-term indulgences, it really makes sense to set it aside for your future, via super. You’ll get a better return on your tax return.”

Currently if you’re aged 67 to 74, you may need to meet the requirements of a work test in order to keep making personal contributions. This involves working for at least 40 hours over 30 consecutive days in the financial year that you make the contributions. However, in its 2021-2022 Federal Budget, the government announced it intends to abolish this work test rule from 1 July 2022.

It’s best to chat to your Financial Adviser who can guide you through current guidelines.

Government contributions

If you earn less than $56,112 in the 2021/22 financial year, you may be eligible for a government co-contribution to your super account.

The government co-contribution scheme operates on a tiered system. The government will pay up to 50 cents for every after-tax dollar you personally contribute to your super account, to a maximum of $500, but this amount will vary depending on your earnings.

You will also need to meet the following criteria:

  • Your income is less than $56,112 per year, which includes your assessable income, reportable fringe benefits, and your total reportable super contributions for the financial year
  • You have made one or more after-tax contributions to your super account
  • You earn at least 10% of your income from employment-related activities, running a business, or a combination of both
  • You do not hold a temporary resident visa at any time during the financial year (except if you are a New Zealand citizen or hold a subclass 405 or 410 visa) 
  • You are aged under 71 years old at the end of the financial year
  • You have lodged a tax return for the financial year
  • You have a total superannuation balance less than $1.7 million at the end of 30 June of the last financial year
  • You have not contributed more than your non-concessional contributions cap.

Spouse contribution

You can make post-tax contributions to your partner’s super account. If you make contributions on behalf of your spouse who has assessable income, reportable fringe benefits and reportable employer super contributions of less than $40,000, you may be able to claim a tax offset of up to $540 per financial year. 

There are a few other conditions you’ll need to meet in order to claim this tax offset.

Other ways to boost your superannuation

There are a few other ways you can boost the amount in your superannuation account:

  • Downsize your home. If you’re ready to downsize, and you, your spouse or both owned your own home for ten or more years, are aged 65 or older and meet certain eligibility requirements, you can contribute up to $300,000 per person from the sale proceeds of your former home. This is on top of any other voluntary super contributions you make.
  • Make sure all your super is consolidated into a single account.
  • Talk to your Financial Adviser about choosing the right super investment options for your circumstances.
  • Participate in part-time work before retiring.

Always make sure you seek financial advice if you’re thinking about altering your superannuation account.

How much can I contribute to my superannuation?

For pre-tax super contributions, you can contribute up to $27,500 per year which will be taxed at the 15% concessional tax rate (high income earners may pay an additional 15% tax). Any contributions over this amount will be taxed at your marginal tax rate and an excess concessional contributions charge will apply.

If you have a total superannuation balance of less than $500,000 at 30 June last financial year, you may be able to increase your $27,500 cap per year by any unused concessional contributions cap amounts carried forward from 1 July 2018. Unused cap space amounts are available for a maximum of five years. 

For post-tax contributions, from 1 July 2021 you can contribute up to $110,000 per year, if you have total superannuation of less than $1,700,000 as at last 30 June. If you are under age 65 on 1 July of the financial year, you may be able to make post-tax contributions which exceed the $110,000 annual cap, depending on your total superannuation balance. Any amount that goes over the relevant cap and associated earnings will generally be released from your super fund and you will be taxed at your marginal tax rate on the associated earnings.

Other things to consider before making extra contributions

Accessing super before preservation age

Currently, depending on when you were born, you can generally access your super when you reach your preservation age (between 55 and 60) if you're retired. It’s not that easy to access superannuation before preservation age. Generally speaking, you can only access your super early if you satisfy severe financial hardship, certain compassionate grounds or become permanently incapacitated.

Super vs debt

If you have a debt to pay off, you might want to consider which is better - to chip away at what you owe or make extra super contributions.

If you’re weighing up whether to make extra contributions to your super or pay off your mortgage, keep in mind that the returns from super funds tend to fluctuate more than mortgage interest rates.

Manage your super with ANZ

ANZ Smart Choice Super offers the flexibility to fit with your changing needs and life stages. With the ability to bundle your banking and super into one account and track your super online or through the ANZ App, ANZ Smart Choice Super is a straightforward and convenient option for managing your super. Find out more about ANZ Smart Choice Super or read about how ANZ Smart Choice Super has performed.

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“ANZ Smart Choice Super” is a suite of products consisting of ANZ Smart Choice Super and Pension (PDF 416kB)ANZ Smart Choice Super for employers and their employees (PDF 594kb) and ANZ Smart Choice Super for QBE Management Services Pty Ltd and their employees (PDF 441kb). The ANZ Smart Choice Super and Pension product is distributed by Australia and New Zealand Banking Group Limited (ANZ) (ABN 11 005 357 522).  We recommend that you read the ANZ Financial Services Guide (PDF 479kB), before deciding whether to acquire or continue to hold this product. View the ANZ Smart Choice Super and Pension Target Market Determination (PDF 252kB). ANZ Smart Choice Super for employers and their employees and ANZ Smart Choice Super for QBE Management Services Pty Ltd and their employees are MySuper compliant products issued pursuant to the latest PDS available at View the ANZ Smart Choice Super for employer and their employees Target Market Determination (PDF 464 kB). ANZ Smart Choice Super is part of the Retirement Portfolio Service (the Fund) (ABN 61 808 189 263) and is issued by OnePath Custodians Pty Limited (ABN 12 008 508 496, AFSL 238346, RSE L0000673) (OPC), the trustee of the Fund. OPC is a member of the Insignia Financial Group of companies, comprising Insignia Financial Ltd (formerly IOOF Holdings Ltd) ABN 49 100 103 722 and its related bodies corporate (Insignia Financial Group). The Australia and New Zealand Banking Group Limited (ANZ) (ABN 11 005 357 522) brand is a trademark of ANZ and is used by OPC under licence from ANZ. ANZ and the Insignia Financial Group of companies (including OPC) are not related bodies corporate. ANZ does not stand behind or guarantee these products.

Before re-directing your super or moving your money into ANZ Smart Choice Super, you will need to consider whether there are any adverse consequences for you, including loss of benefits (e.g. insurance cover), investment options and performance, functionality, increase in investment risks and where your future employer contributions will be paid. 

The information provided is of a general nature and does not take into account your personal needs, financial circumstances or objectives. Before acting on this information, you should consider the appropriateness of the information, having regard to your needs, financial circumstances or objectives. The case studies used in this article are hypothetical and are not meant to illustrate the circumstances of any particular individual. Opinions expressed in this document are those of the authors only.

All fees are subject to change. Other key features are relevant when choosing a super fund, including performance.

Taxation law is complex and this information has been prepared as a guide only and does not represent taxation advice. Please see your tax adviser for independent taxation advice. The information on insurance cover is a summary only of the terms and conditions applying to the insurance cover. To the extent there is any inconsistency with the terms of the insurance cover provided by the insurer, the terms of the insurance policy will prevail.

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Fee Analysis: Research conducted by SuperRatings Pty Ltd, holder of Australian Financial Services Licence No. 311880 at the request of OPC. For a copy of the latest SuperRatings research, click here (PDF 146kB) or call 13 12 87.