Claiming deductions

You can claim a tax deduction for super payments you make for employees in the financial year you make them. This includes salary-sacrificed contributions, provided:

  • the contributions are made under an effective salary sacrifice arrangement
  • the employee is under 75 (there are some circumstances where you can claim a deduction for older employees)
  • the contributions are made to a complying super fund.

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When to pay contributions to claim a deduction

You can claim a deduction for a super contribution – including a salary-sacrificed contribution – only in the financial year that the super fund receives the contribution.

Example – contribution paid after end of financial year

Pieter starts work on 1 July 2015. Pieter's employer makes monthly contributions of $1,200 into his super fund by the 28th day after the month that the contributions relate to.

At the end of the 2015–16 financial year, Pieter's employer can claim a deduction of $13,200 for the 11 monthly contributions made during the financial year. As the contribution for June was made on 28 July 2016, the deduction for this contribution is claimed at the end of the 2016–17 financial year (the year in which it was made).

Example – contribution paid through a clearing house

Sally's employer sends a super contribution of $1,425 to a commercial clearing house on 30 June. Sally's super fund doesn't receive the contribution from the clearing house until 3 July. Sally's employer can't claim an income tax deduction for the $1,425 in the year it paid the contribution to the clearing house. However, the employer can claim the deduction in the next financial year (the year the contribution arrived).

End of example

If you use the Small Business Superannuation Clearing House (SBSCH), super guarantee payments are taken to be received by the super fund the same day that payment is received by the SBSCH. This doesn't apply to salary-sacrificed contributions over and above the minimum super guarantee payments. If you wish to claim a deduction for salary-sacrificed contributions in a particular financial year, you need to ensure the payment is received by the super fund before the end of that financial year.

Employees 75 or older

Super guarantee contributions paid by the quarterly due date are deductible in the financial year they are received by the super fund. So are mandatory contributions under an industrial award or determination or a notional agreement that preserves a state award.

Other non-mandatory employer contributions are deductible only if they are paid within 28 days of the end of the month in which the employee turned 75. Contributions after that are not deductible.

Contributions for an employee's spouse

Contributions made for your employee's spouse are not deductible.

If you make contributions to an employee's spouse's super fund, they will constitute a taxable fringe benefit. You would be liable to pay fringe benefits tax on the amount and your employee's payment summary would need to include the amount as a reportable fringe benefit.

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    Last modified: 27 Jul 2016QC 17235