|
Make a difference to your super by taking advantage of government incentives and tax benefits so that every dollar you put into super works harder.
The government’s Super Co-contribution is designed to help Australians save for their retirements by helping to turn every $1 invested in super into as much as $2.50.
If you earn up to $58,980 and make personal, after-tax contributions to your super, you may be eligible for the co-contribution.
The more money you can put in to super now, the longer it has to accumulate, earn interest and benefit from compounding investment returns.
Boosting your super
How much you earn and how much you contribute to super each year will determine how much you can get as a co-contribution.
So, if you earn $28,980 or less and personally contribute $1,000 in after-tax contributions to your super during the year, the government will match your $1,000 with the maximum co-contribution of $1,500. It works on a sliding scale of earnings, as shown on this table.
Total assessable income plus reportable fringe benefits |
Personal (after-tax) contribution required to obtain maximum co-contribution |
Maximum co-contribution |
| $28,980 or less |
$1,000 |
$1,500 |
| $30,000 |
$966 |
$1,449 |
| $35,000 |
$799 |
$1,199 |
| $40,000 |
$633 |
$949 |
| $45,000 |
$466 |
$699 |
| $50,000 |
$299 |
$449 |
| $55,000 |
$133 |
$199 |
| $58,980 or more |
Not eligible |
Not eligible |
Eligibility
To qualify for the co-contribution, you need to:
- be an Australian resident
- receive 10% or more of your total income (assessable income and reportable fringe benefits) from employment, carrying on a business, or a combination of both
- have total income from all sources of less than $58,980 in the 2007-2008 financial year
- lodge an income tax return for the year
- be less than 71 years old at the end of the income year and be an Australian resident
- not have held an eligible temporary visa at any time in the year, and
- make personal, after-tax contributions to a complying super fund.
It’s important to note that from 1 July 2007 the co-contribution scheme was extended to people who are self-employed.
Additional benefits
The co-contribution counts as an undeducted contribution and is added to your tax-free component, which means it will:
- not be subject to contributions tax
- not be taxed when you withdraw it from the fund at retirement.
Also, it will not be included in any of the contribution limits.
Getting started
To get the co-contribution, all you have to do is make sure you’re making personal, after-tax contributions to a complying fund (and be eligible to receive it!). The Australian Tax Office (ATO) will automatically match your super fund record with your tax return at the end of the financial year. Any co-contribution will then be paid directly into your superannuation fund.
|
