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Superannuation Tax Planning Opportunities

Superannuation remains one of the most tax-effective ways to build long-term wealth and reduce taxable income. As 30 June approaches, it’s worth reviewing the strategies available to maximize your super benefits.

Concessional Contributions Cap – $30,000

For the 2025/26 financial year, the concessional (tax-deductible) contribution cap is $30,000 per person, regardless of age.

Concessional contributions include:

• Employer Super Guarantee contributions
• Salary sacrifice amounts
• Personal deductible super contributions

If you have not fully used your annual cap, you may wish to consider making additional deductible contributions before 30 June 2026, subject to eligibility.

One of the key benefits is the lower tax rate applying to super contributions — generally 15% (or up to 30% for high-income earners) compared with marginal personal tax rates that can exceed 45% plus Medicare levy.

This strategy is commonly used by:

• self-employed individuals;
• investors earning passive income; and
• employees looking to increase retirement savings tax-effectively.

Carry-Forward Concessional Contributions

If your total super balance was below $500,000 at 30 June 2025, you may be eligible to carry forward unused concessional contribution caps from the previous five financial years.

Unused cap amounts can accumulate for up to five years before expiring.

This strategy can be particularly useful for individuals with:

• fluctuating income;
• one-off capital gains; or
• higher-than-usual taxable income in a particular year.

Non-Concessional Contributions

Eligible individuals may also consider making non-concessional (after-tax) contributions.

Contribution limits for 2025/26 are:

• up to $120,000 annually; or
• up to $360,000 under the bring-forward rule over three years.

Eligibility rules apply, so professional advice is recommended before making large contributions.

Government Super Co-Contribution

Low and middle-income earners may qualify for a Government co-contribution when making personal after-tax super contributions.

For the 2025/26 financial year:

• maximum co-contribution available is $500;
• full entitlement generally applies where income is $44,500 or less; and
• partial entitlements may apply for incomes up to $60,400.

To receive the maximum benefit:

• at least $1,000 of non-concessional contributions must be made;
• at least 10% of income must come from employment or business activities; and
• total super balance must remain below the applicable threshold.

You must also be under age 71 at 30 June 2026.

Transition to Retirement (TTR) Strategies

If you have reached your preservation age but are not ready to fully retire, a Transition to Retirement (TTR) strategy may allow you to reduce working hours while supplementing your income from super.

Preservation Ages

Under a TTR strategy:

• you can continue working;
• continue making concessional contributions; and
• draw an income stream from super.

Minimum pension withdrawals generally start at 4% of the account balance, with a maximum annual withdrawal limit of 10%.

Tax Treatment

• Under age 60: withdrawals are taxed at marginal rates, with a 15% tax offset generally available.
• Age 60 and over: pension withdrawals are generally tax-free.

TTR strategies are commonly used to:

• reduce working hours gradually; or
• salary sacrifice into super while maintaining cash flow.

Account-Based Pensions

Individuals aged:

• 60 or over and retired; or
• 65 and over (whether working or not),

may benefit from commencing an account-based pension.

Key advantages include:

• tax-free pension withdrawals; and
• tax-free investment earnings within the pension phase (subject to transfer balance cap limits currently around $1.9 million).

Minimum annual pension payments apply based on age:

There is generally no maximum withdrawal limit for standard account-based pensions.

If you are considering starting a pension, contact your super fund or adviser for guidance.

Self-Managed Super Funds (SMSFs)

A Self-Managed Super Fund (SMSF) can offer greater control and flexibility over retirement savings and investment decisions, along with potential tax advantages.

However, SMSFs also involve:

• strict compliance obligations;
• ongoing administration responsibilities; and
• trustee duties under superannuation law.

An SMSF may suit individuals seeking greater investment control or more tailored retirement planning strategies, but they are not appropriate for everyone.

With year-end approaching, now is a good opportunity to review whether an SMSF could form part of your broader financial and tax planning strategy.

If you would like to explore SMSFs further, professional advice is strongly recommended.

Checklist: Other Year-End Tax Matters to Consider

Alongside tax planning opportunities, there are several important year-end obligations that should be reviewed before 30 June 2026.

Motor Vehicle Records

If you use a vehicle for work or business purposes, remember to:

• Record your odometer reading at 30 June 2026.
• Update or prepare a new logbook if your current one is more than five years old.

A valid logbook must cover a continuous 12-week period. If you begin keeping one before 30 June 2026, it can still be used to support your business-use percentage for the entire 2025/26 financial year.

Account-Based Pensions

If you are drawing an account-based pension, ensure the minimum annual pension payment has been withdrawn before 30 June 2026.

Current minimum withdrawal rates are:

• Under 65: 4%
• Age 65–74: 5%
• Age 75–79: 6%
• Age 80–84: 7%

Business Owners, Companies & Trusts

Superannuation Guarantee Contributions

Employer super contributions for the 2025/26 year are due by 28 July 2026. However, to claim a tax deduction in the 2025/26 financial year, contributions must be received by the super fund (or clearing house) by 30 June 2026.

Avoid leaving payments until the final days of June, as processing delays may impact your deduction.

Division 7A Loans

Business owners who have borrowed money from a private company should ensure minimum principal and interest repayments are made by 30 June 2026.

Loans made during the current year must either:

• be fully repaid; or
• be placed under a compliant loan agreement before the company tax return due date.

Failure to comply may result in the loan being treated as an unfranked dividend.

Trust Distribution Resolutions

Trustees of discretionary (family) trusts should ensure distribution resolutions are prepared and signed before 30 June 2026.

Without a valid resolution:

• default beneficiaries may become entitled to trust income; or
• undistributed income may be taxed at the highest marginal tax rate.

Stocktake Requirements

Businesses holding trading stock should prepare stocktake working papers as at 30 June 2026.

Payroll & STP Finalization

Review and reconcile payroll records for the year, including PAYG withholding obligations

Employers using Single Touch Payroll (STP) are generally no longer required to issue annual payment summaries once payroll information has been finalised through STP.

Key Changes From 1 July 2025

Super Guarantee Increase

The compulsory Superannuation Guarantee rate increased from 11.5% to 12% from 1 July 2025. This rate remains the same, 12%, for 2026-27.

Small Business Company Tax Rate

Base rate entities with aggregated turnover below $50 million continue to qualify for the 25% company tax rate for the 2026 financial year, provided:

• aggregated turnover is below $50 million; and
• no more than 80% of assessable income is passive income.

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Planning ahead before year-end can help avoid unnecessary tax issues and ensure you maximise available opportunities.