The superannuation contributions surcharge (surcharge) is levied on certain super contributions (usually employer and personal deductible amounts). In May 2005, the abolition of the super contributions surcharge was announced as part of the 2005–06 Federal Budget. The surcharge legislation was amended so the surcharge will not apply to any super contributions made on or after 1 July 2005.
The surcharge applies to certain super contributions made after 20 August 1996 and before 1 July 2005. The surcharge will still need to be paid for any liabilities that are raised for the financial years 1997–2005.
From August 2017, no new super surcharge assessments will issue. However, any assessments issued prior to this date will remain due and payable.
Super providers must ensure they lodge any outstanding Superannuation member contributions statements for the 1997–2005 financial years.
Unfunded defined benefit funds and members of constitutionally protected funds are not required to pay a surcharge liability until a member has left the fund or begins to receive their benefits.
The surcharge applies to contributions if the sum of an individual's taxable income and certain other amounts reach a given threshold for the relevant financial year.
Surchargeable contributions for members of accumulation funds include:
- employer contributions
- personal contributions for which a tax deduction has been claimed
- the post- 20 August 1996 portion of an employer eligible termination payment rolled over on or after 1 July 1997
- allocated surplus amounts (this is any amount allocated to a member's account on or after 1 July 1997 by a super provider from surplus that exceeds an amount considered reasonable by an eligible actuary).
Surchargeable contributions for members of defined benefit funds are determined by an actuary using a formula to calculate the value of the benefits and expenses relating to the membership for a financial year.
Personal contributions for which no income tax deduction has been claimed are not surchargeable contributions.