Super and tax

Super is a compulsory savings vehicle that people sometimes take for granted.  But super can also be a tax-effective way of saving for your future.

Super can provide several ways to potentially save on your tax bill. Super can be one of the most tax effective ways to build up a nest egg so it's worth understanding how you might benefit from some of these strategies.

Reduced tax on your salary

If you're earning over $37,000, the personal tax rate on some of your salary is 32.5%. Generally, super is only taxed at 15%. By putting extra money into your super you can potentially lower your taxable income, save on the tax you pay and boost your super.

Learn how salary sacrifice could help you pay less tax

Tax free payments over 60

Once you turn 60, you pay no tax on the super lump sum benefits you withdraw or your super pension payments. 

RetireAccess pays you a salary in retirement

Tax rebates for boosting your spouse's super

If your spouse earns below a certain income and you put some money into their super, you may receive a tax rebate.

Find out how to qualify for a tax rebate

Tax-free super boosts by the Government

Co-contributions may be paid to people who make post-tax contributions into super and earn below a certain income.

Learn more about co-contributions

Tax effective investment earnings

Investment earnings within super or in a Transition to Retirement (TTR) income stream are generally taxed at a maximum of 15%. 
If you have a Retirement income stream the earnings are tax-free. If you have investment earnings outside super, they may be taxed at your marginal tax rate.

Tax refunds for low income earners

The government refunds contribution tax for low income earners. The Low Income Super Tax Offset (LISTO) is a government superannuation payment of up to $500 to help low-income earners save for retirement. If you earn $37,000 or less a year, you may be eligible to receive a LISTO payment directly into your super fund.

Tax deductions for personal contributions

From 1 July 2017, the eligibility rules for claiming a deduction for personal super contributions have changed. Previously, this was only available to members who earn less than 10% of their income from salary or wages.

For contributions made on or after 1 July 2017, this restriction has been removed. This means that all individuals under 75 (including people aged 65 to 74 years who meet the work test) will be eligible to claim a deduction for personal super contributions made to an eligible super fund. This means you can make a post-tax contribution into your super account and claim a deduction for it. The contribution will be classified as a pre-tax contribution which will count towards your pre-tax contribution limit.

Find out how to claim a tax deduction

Need help developing a tax effective strategy?

At TelstraSuper we’re here to help you build a secure financial future. TelstraSuper Financial Planning has a team of phone based Advisers who can provide you with simple advice to help you work out how to maximise your tax savings through super. If you’d like to discuss growing your super or if you have any other financial advice queries contact us on 1300 033 166 or fill in our online contact form. There's no additional cost for our phone based advice as this is included in your TelstraSuper membership.

Online contact form