How it works
How will I know that I have received the super co-contribution?
The Tax Office will send you a letter with details about your co-contribution amount after it has been paid to your super fund. Unless you nominate a particular super fund account to us, your co-contribution will usually be paid into the fund where you make your personal super contributions, providing they accept co-contributions. Your super fund should include the co-contribution on your annual member statement.
Are there any types of super contributions that do not attract the super co-contribution?
Yes, The following super contributions do not count for the co-contribution:
- super guarantee contributions paid by your employer
- personal contributions for which a deduction has been claimed
- contributions made by your spouse or any other party on your behalf, and
- salary sacrifice contributions (these are considered to be employer contributions).
How will the super co-contribution be taxed?
The co-contribution will be treated, for taxation purposes, similarly to the personal contributions that it is matching. That is, it is tax free.
The super co-contribution will not be subject to any tax when it is paid to your super fund or retirement savings account and will not be taxed when received as a benefit. However, the earnings on the super co-contribution will be taxed like any other earnings within the super fund or retirement savings account.
How is my total income calculated?
To be eligible to receive the co-contribution your total income needs to be less than the higher income threshold in any income year. Your ‘total income’ is equal to your assessable income plus your reportable fringe benefits. Your total income may be different to your taxable income.
How do I calculate my co-contributions for previous years?
The way your co-contribution is calculated depends on the financial year in which you made your personal super contributions.
2007-08 income year
The maximum co-contribution amount that you can receive ($1,500) is reduced by 5c for each $1 that your total income exceeds $28,980. The co-contribution phases out completely when your total income is $58,980 or more. The co-contribution was also extended to the self employed who earn business income as a sole trader or as a partner in partnership who made personal super contributions from 1 July 2007.
2006-07, 2005-06 and 2004-05 income years
The maximum co-contribution amount that you can receive ($1,500) is reduced by 5c for each $1 that your total income exceeds $28,000. The co-contribution phases out completely when your total income is $58,000 or more.
Note: A co-contribution received as a result of contributions made in the 2005-06 income year, attract an additional one-off payment, doubling your co-contribution entitlement for that year only.
Provided you are entitled to receive the co-contribution, the minimum amount payable is $20.
The formula for calculating the maximum co-contribution amount is:
$1,500 - {[(assessable income + reportable fringe benefits) - $28,000] x 0.05}
The co-contribution payable is the lesser of:
- the maximum co-contribution amount, or
- the amount of personal super contributions x 1.5.
The co-contribution:
- must be preserved in the fund (it can only be accessed when other preserved amounts can be accessed),
- is not included as income in your tax return,
- will not be subject to any taxation when initially paid to the fund, and
- will not be taxed when received as a benefit.
2003-04 income year
The maximum co-contribution amount that you can receive ($1,000) is reduced by 8c for each $1 that your total income exceeds $27,500. The co-contribution phases out completely when your total income is $40,000 or more.
Provided you are entitled to receive the co-contribution, the minimum amount payable is $20.
The formula for calculating the maximum co-contribution amount is:
$1,000 - {[(assessable income + reportable fringe benefits) - $27,500] x 0.08}
The co-contribution payable is the lesser of:
- the maximum co-contribution amount, or
- the amount of personal super contributions.
The co-contribution:
- must be preserved in the fund (it can only be accessed when other preserved amounts can be accessed)
- is not included as income in your tax return
- will not be subject to any taxation when initially paid to the fund, and
- will not be taxed when received as a benefit.
Sections within Common questions
Last Modified: Monday, 12 October 2009
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