Superannuation Guide 2026 new thresholds

What is superannuation?

Super is a tax‑advantaged structure designed to help Australians save for retirement. Your employer pays a percentage of your ordinary time earnings into a super fund of your choice (or a default fund). You can add extra contributions, and the money is invested until you retire.

2026 update: The Super Guarantee (SG) rate rises to 12% (from 11.5% in 2024‑25). This means from 1 July 2025, your employer must contribute 12% of your salary into super.

Contribution caps 2025‑26

Staying within caps saves you from extra tax. All figures are indexed and current for the 2025‑26 financial year.

Excess concessional contributions are taxed at your marginal rate plus an interest charge.

Choosing a super fund

You have four main options. Compare fees, investment performance, and insurance offerings.

• Industry funds: Profit‑to‑member, often lower fees, balanced options. Examples: AustralianSuper, Hostplus, REST.
• Retail funds: Run by banks or investment companies (e.g. MLC, Colonial First State). More investment choice, but fees can be higher.
• Public sector funds: For government employees, usually with generous benefits.
• Self‑managed super fund (SMSF): You're the trustee; direct control over investments (property, shares, etc.). Suitable for balances >$200k‑$250k.

Use ATO’s “YourSuper” comparison tool to see how your fund performs after fees.

Insurance through super

Most funds automatically include:

• Life insurance (death cover): Pays a lump sum to your beneficiaries.
• Total and permanent disability (TPD): Paid if you become permanently disabled.
• Income protection: Replaces up to 70% of your salary if you can't work due to illness or injury.

Check if you have duplicate cover across multiple funds — you can consolidate and cancel unnecessary policies to save fees.

2026 strategies to grow your nest egg

• Salary sacrifice: Arrange with your employer to put extra pre‑tax dollars into super — saves income tax and boosts your balance.
• Spouse contributions: If your partner earns under $40,000, you may claim a tax offset of up to $540.
• Government co‑contribution: Earn less than $58,445? Make a personal after‑tax contribution and the government kicks in up to 50¢ per dollar (max $500).
• Carry‑forward concessional contributions: Use unused cap space from previous years (since 2018‑19) if your total super balance was below $500,000 on 30 June prior.
• Downsizer contribution: If you're 55 or older, you may contribute up to $300,000 from the sale of your home (exempt from contribution caps).

When can you access your super?

Your super is preserved until you reach preservation age (between 55 and 60, depending on birth date) and retire. The table below shows preservation age by birth year:

Once you reach preservation age and retire, you can access your super as a lump sum or income stream (like an account‑based pension). Transition‑to‑retirement (TTR) strategies allow you to access some super while still working.

2026 updates at a glance

• SG rate: 12% (up from 11.5%)
• Concessional cap: $30,000 (indexed, same as 2024‑25)
• Non‑concessional cap: $120,000
• Transfer balance cap (TBC): $1.9 million (for pensions)
• Total super balance (TSB) thresholds: For bring‑forward and catch‑up contributions, indexed.
• Downsizer contribution age: 55 (unchanged).

Always check the ATO website for exact indexation figures in May each year.