New year, new superannuation changes

With the new financial year comes a fresh wave of superannuation changes that could make a real difference to your retirement savings.

Let’s unpack these superannuation changes and how you can make the most of them.

The super guarantee rate hits 12%

One clear boost to retirement incomes is the increase in the Superannuation Guarantee (SG) rate from 11.5% to 12%.

Your employer is now required to pay 12% of your ordinary time earnings into your nominated super fund. It’s a good idea to check your first payslips for the new financial year to ensure the updated rate has been applied.

If you have a salary sacrifice arrangement, note that the SG is calculated based on your pre-sacrifice salary, as if the arrangement were not in place.

For a quick estimate of how this change could impact your super balance, try the MoneySmart Superannuation Calculator.

More room in the retirement phase

Beyond regular contributions, the amount of super that can be transferred into the retirement phase, known as the general transfer balance cap (TBC), has increased from $1.9 million to $2 million, effective 1 July 2025.

If you exceed the cap, you’ll need to transfer the excess back to your accumulation account or withdraw it as a lump sum. You may also be liable for tax on the earnings.

If you’ve already commenced a retirement income stream, you’ll have a personal TBC, which may be lower than the general cap. Your personal cap is based on the general cap at the time you started your income stream, adjusted for how much you’ve used and any indexation you’re entitled to.

For example, if you begin a pension with $2 million on 1 July 2025, you’ve used your entire cap. The cap doesn’t limit how much you can hold in super overall and any excess can remain in your accumulation account.

You can check your cap via ATO online services, which track all the debits and credits that make up your balance.

Note: Special rules apply for defined benefit income streams.

More eligible for after-tax contributions

The increase in the general TBC to $2 million may also allow more individuals to make non-concessional (after-tax) contributions using the bring-forward rule.

While the $120,000 annual cap on non-concessional contributions remains unchanged, eligibility for the bring-forward rule now applies to those with a total super balance below $2 million.

This rule allows you to bring forward one or two years of your annual cap, enabling contributions of up to $360,000 in a single financial year.

No change to contribution caps

Although more people may now qualify for the bring-forward rule, the caps on both concessional (before-tax) and non-concessional (after-tax) contributions remain unchanged.

The tax you pay on contributions depends on whether they’re made from before-tax or after-tax income, whether you exceed the caps, or if you’re a high-income earner.

• Concessional contributions cap: $30,000
• Non-concessional contributions cap: $120,000
• Bring-forward rule: Up to $360,000 over three years

If you have unused concessional cap amounts from previous years, you may be able to carry them forward to increase your contributions in future years.

Have questions or need help navigating these superannuation changes? Our experienced financial advisers are here to support you. Whether you’re planning for retirement or simply want to ensure you’re making the most of your opportunities, we can help you develop a strategy tailored to your goals. Contact us today.