Personal Super Contributions

The most common way for employees to add to their SMSF balances is to use the 9.50% (increasing to 12%) compulsory Super contribution. Additionally, you can salary sacrifice Super into your SMSF.

The ATO defines a self-employed person as someone who earns less than 10% of their taxable income as an employee. If this is true in your case, you should fill out a form notifying the Superannuation Fund (retail fund, industry fund or SMSF) of your intention to claim a tax deduction for your Super contribution. The Super Fund will then take this contribution as a concessional contribution (taxed at the concessional rate of 15%) and the Super contribution can be claimed as a tax expense in your personal tax return.

Articles and advertisements explaining how you can make the most tax-effective use of your Super often refer to personal contributions or Super salary sacrifices.  You can find more about these at the ATO website by clicking here.

Superannuation Warehouse also has a page explaining Self-Employed Contributions in an SMSF. Another option may be to add a non-concessional contribution (after-tax money) to your SMSF. The disadvantage of this is that you will have paid tax at a marginal rate (after tax money) and therefore lose the concessional tax advantage of contributing into the Super.

In order to advise your SMSF that you intend to claim a tax deduction for your personal super contributions, you should complete a “section 290-170 notice” tax form. You can download a copy from this web page.

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We are Melbourne based with clients throughout Australia. Our SMSF administration service is mostly paperless. This enable us to charge a fair fee, resulting in a good value-proposition for you.

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Superannuation Warehouse is an accounting firm and do not provide financial advice. All information provided has been prepared without taking into account any of the Trustees’ objectives, financial situation or needs. Because of that, Trustees are advised to consider their own circumstances before engaging our services.