The Commonwealth Government's Super Co-contribution is designed to help eligible people increase their retirement savings by topping up their super.
If you're under 71 years old as at 30 June 2017, your total income1 is under $51,021 for the financial year, and you make an after-tax contribution to your super, you could qualify for a Super Co-contribution.
If you are eligible, the government could match up to 50% of your after-tax super contributions to a maximum of $500, depending on your income and the amount you contribute after tax to your super.
What this means is that the money you have in your super account will grow faster and you'll have more to look forward to when it comes time to retire. The Super Co-contribution is not taxed and is preserved in your super fund until you can access your super. Earnings on the Super Co-contribution are taxed in the same way as other earnings in your super account.
For the 2016/17 financial year, the lower income threshold is $36,021 and the higher income threshold is $51,021.
If you qualify and your total income is equal to or less than the lower threshold, you'll receive the maximum Super Co-contribution of 50 cents for every (after-tax) dollar you contribute, to a maximum of $500 a year. However, if your total income is between the thresholds, your maximum entitlement reduces by 3.333 cents for every dollar your total income is over $36,021. If your total income is equal to or greater than the higher threshold, you are not eligible for a Super Co-contribution.
To qualify, you'll need to make an after-tax contribution to your super before the end of June and meet all of the following criteria:
Your total income for the financial year is less than $51,0211 and you earn at least 10% of your income through eligible employment, running a business, or both
You lodge an income tax return with the Australian Tax Office for the current financial year
You are less than 71 years of age as at 30 June 2017
You provide your tax file number to GESB if you haven't already
You are not the holder of an 'eligible temporary resident visa' at any time during the financial year, unless you are a New Zealand citizen or holder of a prescribed visa
How to receive a Super Co-contribution
You don't need to apply for a Super Co-contribution. If you are eligible, this money will be automatically paid into your GESB account after you have lodged your tax return for the relevant financial year.
How to make an after-tax contribution to your super
You can make after-tax contributions by one of the following:
1 Total income for the year includes any reportable fringe benefits and reportable employer super contributions, minus any allowable business deductions. 2 Please note contributions to your super from your payroll can take up to two weeks to process.