Super co-contribution

10% eligible income test

To satisfy this test, 10% or more of your total income must come from employment-related activities, carrying on a business or a combination of both. These amounts are referred to as eligible income amounts.

For the purposes of this test, your total income is not reduced by your allowable business deductions. This is to ensure self-employed individuals are not disadvantaged by arbitrarily failing the 10% eligible income test in a financial year if they have low income or low profit margins.

For the 2007-08 and subsequent financial years

To satisfy the 10% eligible income test, 10% or more of your total income must come from eligible employment-related activities or carrying on a business (or a combination of both).

Examples of total income and eligible income

The table below is a guide. Working out the exact amount of your total income and eligible income may be complex depending on your circumstances. You may need to seek professional advice to assist you in this regard.

The following table provides some examples of what types of income count towards total income for super co-contributions purposes. This table is only relevant for 2007-08 and later financial years.

	Total income?	Eligible income for the 10% eligible income test?
Salary or wages, including employment income through a company or trust	Yes	Yes, where you are treated as an employee for the purposes of the Superannuation Guarantee (Administration) Act 1992 (SGAA).
Director fees as a company director	Yes	Yes, where you are treated as an employee for the purposes of the SGAA.
Other employment related income (including tips, employer lump sum payments and employer termination payments and allowances)	Yes	Yes, where you are treated as an employee for the purposes of the SGAA.
Reportable fringe benefits	Yes	Yes
Reportable employer super contribution	Yes (from the 2009-10 financial year)	Yes (from the 2009-10 financial year)
Business income as a sole trader	Yes	Yes
Business partnership distribution	Yes	Yes
Non-business partnership distribution	Yes	No
Distribution from a trust	Yes	No
Other income from individually or jointly held assets (including interest, rent and dividends)	Yes	No

For more information, refer to Income tests and how they affect you.

Sections within Income tests

• Income threshold test
• 10% eligible income test