Government co-contribution

The government co-contribution scheme is an incentive to encourage Australians to contribute to their super on a post-tax basis. If eligible, you could receive an additional contribution to your super from the government. The maximum government super co-contribution entitlement remains at $500, however the lower-income threshold increases to $43,445 and the higher-income threshold increases to $58,445.

Increase in the Superannuation Guarantee

The contributions that your employer is required to make into your super fund, the Superannuation Guarantee (SG), will rise from the current rate of 10.5% to 11% from 1 July 2023. A higher SG rate means potentially greater savings for your retirement. 

Total super balance cap set to increase

The total super balance cap is increasing from $1.7 million to $1.9 million from 1 July 2023, meaning you can’t make additional non-concessional (post-tax) contributions to your super once your super balance exceeds $1.9 million as at 30 June 2023, or you may be penalised. Pre-tax (concessional) contributions can still be made.

Transfer balance cap set to increase 

The transfer balance cap is a limit on the amount of superannuation that can be transferred into retirement phase income streams, including most pensions and annuities. From 1 July 2023 the transfer balance cap will increase from $1.7million to $1.9 million, if you haven’t already moved money into a retirement income stream before 1 July 2023. If you have commenced a retirement income stream before 1 July 2023, your transfer balance cap will be between $1.6-$1.9 million (check your personal transfer balance cap with the Australian Taxation Office (ATO)).

All retirement products you have will count towards this cap, which is managed by the ATO. You can continue to open multiple retirement income streams as long as you remain below the cap.

One of the main benefits of transferring super savings into a retirement pension is that the investment earnings within your retirement pension account are generally tax-free, and from age 60 onward, so are any pension payments you receive.

Removal of the temporary reduction in superannuation minimum drawdown rates

The minimum drawdown requirements determine the minimum amount of a pension that a retiree has to draw from their superannuation in order to qualify for tax concessions. The temporary 50% reduction of the minimum  pension drawdown rates, introduced during the COVID pandemic, will end on 30 June 2023. The government’s standard minimum drawdown rates will apply from 1 July 2023, as outlined below.

Age	Standard minimum annual payment (%)
Under 65	4
65-74	5
75-79	6
80-84	7
85-89	9
90-94	11
95 or more	14

Need some help with your super?

This general advice has been prepared without taking into account your objectives, financial situation or needs. Before you act on any general advice o, you should consider whether it is appropriate to your individual circumstances. Before making any investment decision, you should obtain and read the relevant product disclosure statement which is available on the Website or by calling 1300 033 166 between 8.30 am and 5.30 pm (AEST) Monday to Friday. You may wish to consult an Adviser before you make any decisions relating to your financial affairs. To speak with an Adviser from TelstraSuper Financial Planning call 1300 033 166.