Transfer balance cap explained

From 1 July 2025, this limit (known as the general transfer balance cap) increased to $2 million. While this is good news for some, the higher cap won’t apply to everyone, and other caps and limits will also be affected.

Below we give you a brief overview of what’s happening and where to go for more info.
 

What is the transfer balance cap?

One of the main benefits of transferring super savings into a retirement pension is that the investment earnings within your retirement pension account are tax-free, and from age 60 onwards, so are any pension payments you receive.

The transfer balance cap was introduced from 1 July 2017 and is a limit on how much can be transferred from your super savings into a retirement pension, regardless of how many retirement pensions you hold. Note, these are not to be confused with the government’s Age Pension, or a transition to retirement pension.

Once you’ve fully used your personal transfer balance cap, you generally can’t add more money to a retirement‑phase pension, even if your pension balance later falls.

This is because the cap is based on the highest amount you’ve ever transferred into retirement phase.If you transfer more than your relevant transfer balance cap into a retirement pension, tax penalties may apply.
 

Why is the transfer balance cap changing?

The reason the general transfer balance cap is increasing is because changes to the cap are dependent on the cost of living, as measured by the Consumer Price Index, which recently went up.
 

Who does the new transfer balance cap apply to?

While the general transfer balance cap has changed, your personal transfer balance cap could be $1.6 million, could increase to $2 million, or it could be somewhere in between.

What that will come down to is whether you move, or have already moved, money from your super account into a retirement pension as at 1 July 2017 or since then. How much you’ve moved will also have an impact.

The general transfer balance cap has increased as shown in the following table:

Broadly, if you had a retirement phase pension within any of the date ranges above you would only be eligible for indexation of your personal cap to the extent you have never fully used your personal transfer balance cap.

If you start a retirement‑phase pension for the first time on or after 1 July 2025, your personal transfer balance cap will be $2 million.
If you started a retirement pension earlier, your personal cap will depend on how much of your cap you’ve already used and whether you were eligible for indexation.

If you transfer (or have transferred) less than $1.6 million, your personal transfer balance cap will be anywhere between $1.6 million and $2 million.

If you have fully used, or exceeded, your transfer balance cap, your personal cap will not increase and you will not eligible for any future indexation.
 

Where can I view my transfer balance cap details?

You can view all transfer balance cap info via the ATO section of your myGov account.

You’ll also be able to view your details there if you’re planning to start a pension account after 1 July 2023.
 

What other changes are happening that could affect me?

Changes to the general transfer balance cap mean some other caps and limits, which may apply to you, have also been adjusted.

1. The total super balance cap (after which non-concessional contributions to your super can no longer be made) will increase from $1.7 million to $2 million.

2. The limit that determines if you’re entitled to a government super co-contribution will increase from $1.7 million to $2 million.

3. The limit for claiming the tax offset on spouse contributions will increase from $1.7 million to $2 million
    

Looking for more information?

Speak to your adviser about what might be right for you.

In the meantime, for a brief rundown of the different types of pensions out there and how these differ to the government's Age Pension, check out our pensions info page.