How to claim personal Superannuation contributions at tax time

Adding funds to your super is a great way to save for retirement and plan for the future. But did you know that you can make extra contributions and also claim them on your tax return to boost your refund?

Contributions from your employer aren’t the only way to grow your super, you can make contributions on your own. This can be through a salary sacrifice arrangement or by making personal contributions. You’ll also get the added bonus of claiming them on your return as well.

What are personal Super contributions and how do I make them?

Personal super contributions are non-concessional or after-tax contributions to your super fund. These are different to concessional or pre-tax contributions made by your employer or through a salary sacrifice agreement.

You can make these contributions through BPAY to your super fund directly from your bank account. Ensure you have the correct details for your super fund before making the payment.

You can also speak to your employer to make personal super contributions or after-tax contributions in the same manner you would enter into a salary sacrifice arrangement.

The main thing to note here is that if you plan on claiming these contributions on your tax return, they have to be from your after-tax take home income.

Claiming personal Super contributions on your tax return

Claiming personal super contributions is easy. What you need to do is make sure the contributions are made in time so that they appear in your super fund before the end of the financial year on 30 June.

Once they have been received, you can inform your super fund you want to claim a deduction for those contributions. This is done by submitting the ‘notice of intent to claim or vary a deduction for personal super contributions’ form directly to your super fund, or by completing their own paper form. Remember that this is not sent to the ATO, rather directly to your super fund.

Your super fund will verify your contributions and the amount you wish to claim as a deduction, and then send you a reply confirming you can claim the deduction. They will also inform the ATO and it’ll appear on your pre-fill report as well.

The only thing left to do is to put the deduction on your tax return and you’re all done.

Limits on claiming personal Super contributions

When you claim a deduction for your personal contributions, you are converting them from non-concessional to concessional contributions. In other words, they change from after-tax to before-tax contributions.

For the 2022-2023 financial year, the limit for super contributions is $27,500 after which a higher tax rate is applied. This limit includes the contributions your employer makes at 10.5% or your salary, plus any before-tax contributions made through salary sacrificing.

This also includes the after-tax contributions you plan to claim a deduction for since claiming a deduction converts the after-tax contributions to before-tax contributions.

An example of personal Super contributions claimed as a deduction

Andy works as a construction project manager and has a salary of $200,000. His employer has contributed $21,000 for this year. Andy also salary sacrifices $25 each week to his super, which comes to $1,300 for the year.

This puts his total contributions for the year at $22,300. Given the limit of $27,500 he can still contribute $5,200 through personal super contributions.

Andy decides to contribute $5,000 to his super fund from his after-tax pay and claim a deduction for that. He transfers that to his super through BPAY and submits his notice of intent form. His super fund sends a letter acknowledging his contributions and intention to claim a deduction.

Andy fills in $5,000 as a deduction in the personal super contributions section on his tax return.

This allows Andy to not only build his super balance but also get a tax benefit through a better refund from the ATO.

If you want to know more about personal super contributions and claiming a deduction for them, reach out to Link Advisors for any questions.