Do you salary sacrifice and if so, have you considered the new reduction in the concessional contribution cap? Or do you not yet salary sacrifice but would like to know the benefits?

If you already have a salary sacrifice arrangement in place with your employer, have you reviewed it in light of the reduction to the concessional contribution cap? You may have put this arrangement into place when the contribution cap was higher or perhaps your salary was lower.

The new cap from 1 July 2017 is $25k. This is regardless of your age. This includes any contributions your employer makes on your behalf such as Super Guarantee or salary sacrificed amounts as well as any personal deductible contributions you may make (if eligible to do so). Ensure you sit down with your employer soon so that you can make any necessary adjustments before you exceed the cap.

Perhaps you don’t yet salary sacrifice and would like to. This is an arrangement you can make with your employer to put a bit extra into super prior to receiving your pay packet. Not only are you increasing your retirement funds but you could also be saving yourself tax.

Let’s imagine you earn $100,000 a year. Your employer puts 9.5% of your salary into super for you already making total annual contributions of $9,500. What would happen if you asked your employer to reduce your annual pay by $10,000 and contribute that in addition to your SG contributions to super? Well, let’s take a look:

So as you can see you end up with a little bit more when you consider both your take home pay and your super contributions.

You must however consider your own personal circumstances prior to contributing to super.

Please contact us on 1300 039 190 to review your individual situation.


This information has been prepared without taking into account your objectives, financial situation or needs. Because of this, you should, before acting on this information, consider its appropriateness, having regard to your objectives, financial situation or needs.