You are eligible to claim a deduction if:
- you satisfy the 'maximum earnings as an employee' condition
- you meet the age-related conditions
- you made personal contributions to a complying super fund or a retirement savings account (RSA)
- you made the contributions in order to obtain super benefits for yourself, or for your dependants in the event of your death
- you have written to your super fund or RSA provider, in the approved form Deduction for personal super contributions (NAT 71121, PDF 188KB), and advised them of the amount you intend to claim as a deduction
- your super fund or RSA provider has acknowledged your notice of intent and agreed to the amount you intend to claim as a deduction.
What is the 'maximum earnings as an employee' condition?
You may be able to claim a deduction for personal contributions even if you receive some income as an employee, as long as you satisfy the 'maximum earnings as an employee' condition.
Under this condition, less than 10% of the total of the following must be in respect of your employment activities:
- your assessable income for the income year
- your reportable fringe benefits for the income year
- the total of your reportable employer super contributions (RESC) for the income year.
This is the case regardless of whether your employer has paid super on your behalf.
Example
Big Bob runs a business as a promoter. During the 2006-07 income year, he earned $70,000 assessable income from his business.
Bob also worked as an employee for another promoter, where he earned $6,500 before tax.
Bob may still be eligible to claim a deduction for his personal super contributions, as the income from his employment with the other promoter ($6,500) is less than 10% of his combined assessable income, reportable fringe benefits and RESC ($76,500 x 10% = $7,650).
What are the age restrictions for claiming a deduction?
If you are 75 years old or over, you can only claim a deduction for contributions you made before the 28th day of the month following the month in which you turned 75.
If you are under 18 years old at the end of the income year in which you made the contribution, you can only claim a deduction for your personal super contributions if you earned income as an employee or a business operator during the income year in which you claim the deduction.
Last Modified: Friday, 10 June 2011