The Government is offering co-contributions to your super of up to $500
To reward Aussies for putting their own money towards their retirement savings, the Government is offering co-contributions to super of up to $500! If you meet the eligibility criteria for the co-contribution scheme, the Government will give you an extra 50% of what you contribute to your superfund (up to a maximum of $500). That means if you make a super contribution of $1000, they’ll give you an additional $500, no strings attached! (eligibility criteria applies)
How does it work?
If you meet the eligibility criteria, the Government will co-contribute 50% of your personal contribution to your super fund (up to $500). To receive the co-contribution, you must make your personal super contribution before 30 June 2022.
Remember that a lot of funds have cut off dates that are earlier then 30 June, so be sure to check the requirements of your specific fund.
You will then need to lodge your income tax return for the 2021/22 financial year. The contribution is tax-free and does not affect your taxable income. The minimum co-contribution amount is $20.
Any amount personally contributed over $1,000 will still only receive $500 of co-contribution.
What is the eligibility criteria?
To be eligible for the co-contribution, you must meet the following criteria:
- You have made one or more personal, after-tax contributions to your superfund this financial year (contributions made by your employer don’t count);
- You are under the age of 71;
- You are an Australian citizen or resident (or from New Zealand);
- Your income is less than $56,112, and at least 10% of this is from employment (salary and wages) or business (business income or director fees);
- You must not claim a tax deduction for the contribution;
- You must have less than the general transfer balance cap ($1.7 million as at 1 July 2021) in your superfund;
- You must not have exceeded your non-concessional contributions cap ($110,000) this year;
- You made your contribution before 30 June 2022 (hurry!).
How much will the Government co-contribute to MY superfund?
|Total Income in 2021/2022 FY||Government Co-Contribution Amount|
|$41,111 or less||50% of your contribution (up to $500)|
|$41,112-$56,111||50% of your contribution (up to $250)|
|$56,112 or more||You are not eligible for the scheme.|
Note: The co-contribution will only be paid to ONE fund, so you cannot contribute to multiple different superfunds to try and claim more co-contributions.
Due to the nature of the co-contribution, the amount will be preserved in your superfund, and you will not be able to access it until retirement, or until release conditions are met.
Although you cannot have the cash paid into your personal bank account, if you are a first home buyer, you can make the personal contribution to your superfund so that you receive the co-contribution, and later withdraw that personal contribution (but not the 50% co-contribution) to use as part of your first home deposit! (subject to eligibility)
How do I apply?
You do not need to do anything to apply for the co-contribution. When you lodge your tax return, you will be assessed and –assuming you are eligible and the superfund already has your TFN– the amount will be automatically contributed for you. If you have more than one superfund, you will need to nominate the fund that you wish to receive the contributions through the ATO’s online services (MyGov) or via phone.
When should I expect to receive my co-contribution?
Most co-contributions are paid out between November and January each year.
If you are already retired and without an eligible superannuation account, but meet the remainder of the criteria, you may be able to receive the amount directly. Contact us to find out more.
Have questions or want to know more?
Get in touch with us here.