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  • Division 293 calculation explained

    We use the following information to assess whether you’re liable to pay Division 293 tax:

    • income tax return to determine income for surcharge purposes
    • MCS and SMSF annual returns to determine low-tax contributions.

    Assessments for Division 293 tax are issued once we have your income tax return and an MCS or SMSF annual return.

    Note: If you have more than one fund and it reports contributions for you after you have lodged your income tax return, you may receive an amended Division 293 tax assessment.

    The threshold at which a Division 293 tax calculation will result in an assessment being issued is $250,000. Prior to the 2017–18 financial year this was $300,000

    Income for surcharge purposes

    The income component of the Division 293 tax calculation is based on the same income calculation used to determine if an individual needs to pay the Medicare levy surcharge (MLS), disregarding any reportable superannuation contributions reported on the income tax return.

    The components of this income calculation are:

    • taxable income (assessable income minus allowable deductions)
    • total reportable fringe benefits amounts
    • net financial investment loss
    • net rental property loss
    • net amount on which family trust distribution tax has been paid
    • super lump sum taxed elements with a zero tax rate.

    These amounts are added up (except the super lump sum amount, which is subtracted) to give the income amount.


    David reports the following amounts on his income tax return:

    • taxable income of $290,000
    • total reportable fringe benefits of $10,000
    • net amount on which family trust distribution tax has been paid of $15,000.

    This gives David an income component for Division 293 tax purposes of $315,000.

    End of example

    Low-tax contributions

    Low-tax contributions equal an individual's concessional contributions minus any excess concessional contributions. The concessional contributions counted for Division 293 tax purposes generally include:

    • employer contributed amounts
    • other family and friend contributions
    • assessable foreign fund amounts
    • assessable amounts transferred from reserves
    • personal contributions for which you have been allowed a deduction
    • defined benefit contributions.

    These contributions are concessionally taxed at 15% within the super fund.


    David has low-tax contributed amounts of $40,000.

    David has a concessional contribution cap of $25,000 – as a result, he has excess concessional contributions of $40,000 - $25,000 = $15,000.

    David’s low-tax contributions are his concessional contributions ($40,000) minus his excess concessional contributions: $40,000 - $15,000 = $25,000.

    End of example

    Taxable contributions

    The total taxable super contributions amount is not the same as low-tax contributions. Taxable contributions are the lesser of the low-tax contributions and the amount in excess of the threshold.


    For the 2017–18 income year, David had income for surcharge purposes of $315,000 and low-tax contributions of $25,000.

    The amount of taxable contributions is the lesser of the:

    • amount of low-tax contributions = $25,000, and
    • amount of income and low-tax contributions above the threshold = $315,000 + $25,000 = $340,000 - $250,000 = $90,000.

    As a result, the amount of David’s taxable contributions for the 2017–18 income year is $25,000 because it is the lesser of the two amounts.

    End of example
      Last modified: 05 Jan 2018QC 36272