Super Contribution Caps

Knowing how much you can contribute to your super in any given year is crucial to avoid paying unnecessary taxes or penalties. Let’s dive into the contribution limits for the 2024/2025 financial year and highlight any exceptions to the general rules.

Super Contribution Caps Overview

Your contribution caps depend on a number of factors, including age, employment status, the type of contribution you’re making, your super account balance, and any contributions you’ve made in the past. Generally, there are two types of contributions you can make: concessional contributions and non-concessional contributions, each with its own cap and rules.

Concessional Contribution Cap

For the 2025 financial year, the general concessional contribution cap is $30,000 per person. This is the maximum amount that can be contributed to your super under concessional contributions, but there are some exceptions.

Concessional contributions include:

• Employer contributions

• Salary sacrifice contributions

• Personal concessional contributions (those you make from your own pocket and claim a tax deduction for)

  
  

Concessional Contribution Cap Exceptions

Carry-Forward Unused Cap RuleIf you haven't used your full concessional cap in the past, you may be able to carry forward any unused cap amounts from the last five years. This means you could exceed the general $30,000 limit in the current year — without incurring penalties.

What Happens If You Contribute More Than $30,000?

If you exceed the $30,000 cap, there may not be a problem if you’re using unused carry-forward cap amounts. If you haven’t used carry-forward cap, though, the excess contribution will be taxed at your marginal tax rate (plus interest on earnings that were taxed concessionally). You can then either leave the excess within super or withdraw the after-tax amount.

Non-Concessional Contribution Cap

The general non-concessional contribution cap for the 2025 financial year is $120,000 per person. This is the maximum you can contribute into super as a non-concessional contribution — which means after-tax contributions you haven’t claimed a tax deduction for.

Non-concessional contributions are not subject to a tax deduction, but they must adhere to age and balance restrictions.

Non-Concessional Contribution Cap Exceptions

Bring-Forward Rule

If you’re under 75, you can use the bring-forward rule to bring forward up to two additional years of your $120,000 cap. This allows you to contribute $360,000 at any point over a three-year period — no need to worry about the annual $120,000 cap.

Downsizer Contribution

If you sell your home, you can contribute up to $300,000 from the sale proceeds into your super, and it won’t count towards your non-concessional cap. You need to be 55 or older to make a downsizer contribution, and both members of a couple can contribute $300,000 each.

What Happens If You Contribute More Than $120,000?

If you go over the $120,000 non-concessional contribution cap, the bring-forward rule kicks in automatically. If you're not eligible for the bring-forward rule, you have two options:

1. Withdraw the excess contribution (plus 85% of the earnings) — these earnings will be taxed at your marginal tax rate.

   
   

2. Leave the excess in your super, but you’ll face a 47% tax on that amount — yikes.

   
   

It’s definitely worth keeping track of your contributions throughout the year to avoid these penalties. You can log in to your super account and check the contributions made (it’ll be listed on your transaction statement), or you can contact your super fund directly to get the latest info on your contributions.

Key Takeaways

• Concessional Cap: $30,000, with the possibility of carrying forward unused cap amounts from previous years.

  
  

• Non-Concessional Cap: $120,000, but the bring-forward rule allows you to contribute up to $360,000 over three years if under 75.

  
  

• Downsizer Contribution: Up to $300,000 from the sale of your home into super without counting toward your non-concessional cap (for those over 55).

  
  

• Exceeding the Cap: If you exceed the caps, be ready to face potential taxes, including a hefty 47% on non-concessional contributions if they go too high.

  
  

So, keep an eye on your contributions and stay within the limits to make the most of your super.