How do you put savings into super?

Paying a little extra into super before your pay even hits your bank account is one of the simplest ways to help your balance grow. This is called salary sacrifice and it’s something most employers can help you with. Just ask your payroll team to make a direct payment from your before-tax salary into your super fund – they might need you to fill in an online or paper form to get this all set up for you.

The amount you decide to save is completely up to you and you can stop making these payments whenever you like. Making an extra $10 or $20 each month and making good investment choices can make a difference to your super balance. Not only that, you could be saving on your income tax each time you get paid.

Salary sacrifice is one way to make regular before-tax payments into your super savings. As a set and forget solution, it helps you save without having to think or do anything else.

You might be more comfortable saving into a regular account from week to week or month to month. If you find you don’t need that money for anything else, you can move it to your super fund when you’re ready - by making regular or one-off transfers using BPay or a direct debit arrangement with your super fund.

If you do this, you may be eligible to claim a tax deduction on the amount you put into super. While a tax deduction will reduce your taxable income, the amount of personal contributions you claim will be taxed at 15% inside super (similar to salary sacrifice).

To claim a tax deduction you must complete a ‘Notice of intent to claim’ or vary a deduction for personal contributions’ form and give it to your super fund by the due date. This form is available on the Australian Taxation Office website. If you don’t claim a tax deduction for these contributions, they are after-tax contributions, also known as a personal contribution or non-concessional contribution.

Generally you can’t access your money in super until retirement.

Find out how super payments can help you save on tax

If your partner is a low-income earner, you can help them save more super (subject to eligibility) by:

• helping them make a personal contribution (up to $1,000) to receive a Government Co-contribution of up to $500.
• making a spouse contribution into their account. If your partner is earning less than a certain amount, you may be eligible to receive a spouse contribution tax offset of up to $540.

You can split part of your super guarantee payments, salary sacrifice and personal contributions for which you claim as a tax deduction to your spouse’s super. They still count towards your cap, but this can be a helpful way of boosting your spouse’s lower balance. 

Visit the ATO website to find out more about the Government Co-contribution, spouse contribution tax offset and super contributions splitting.