What are Concessional (Before Tax) Superannuation Contributions?
Concessional Super (Before Tax) Contributions are payments that are deducted from the employees’ gross salary or wages and paid directly to their Superannuation Fund. As these payments are deducted before tax is calculated, they will be taxed once the Superannuation Fund receives the contributions.

Types of Concessional Super (Before Tax) Contributions include:

  1. employer contributions, such as
    1. compulsory employer contributions (currently 9.50%)
    2. any additional pre-tax super contributions
    3. salary sacrifice payments made to their super fund
    4. other amounts paid by you from their pre-tax income to their super fund, such as administration fees and insurance premiums
    5. contributions that the employee is allowed as an income tax deduction, such as contributions they make if they are self-employed
  2. notional taxed contributions if they are a member of a defined benefit fund
  3. some amounts allocated from a fund reserve.

If there are no limitations specified in the terms of their employment, there is no limit to the amount the employee can salary sacrifice. However, they should also consider whether:

  • the additional salary they wish to sacrifice will cause them to exceed the concessional (before-tax) contributions cap and attract additional tax – this cap limits * the amounts that can be contributed to their super fund and still receive the concessional tax rate of 15%
  • the salary amount they sacrifice will attract Division 293 tax  – this occurs when they have an income and concessional super contributions of more than $300,000 in one year.

How do I set up a Concessional (Before Tax) Superannuation Contribution Deduction?
Please follow How do I set up a Concessional (Before Tax) Superannuation Contribution Deduction?

Revision: 11
Last modified: 2020/03/06

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