CHANGES TO SUPER GURANTEE & CONTRIBUTIONS CAPS FROM 1 JULY 2024
SUPER GUARANTEE RATE TO INCREASE TO 11.5%
From 1 July 2024 the Super Guarantee will increase to 11.5%. It will then increase by a further 0.5% on 1 July 2025 to reach 12%. These small increases to the Super Guarantee could make a big difference to super member balances in the long term due to the magic of compound interest.
As an employer, it is compulsory to pay your eligible employees super guarantee (SG) at least 4 times a year. If you don’t pay the required SG amount by the due date you must pay the super guarantee charge.
Generally all employees are eligible for super guarantee. It does not matter if the employee is full, part time or casual and you pay it regardless of their earnings.
CONCESSIONAL CAPS
If you’re making—or you’d like to make – extra contributions you may be pleased to learn about the new contributions caps. You may be able to add a higher amount in voluntary contributions if you choose to.
The concessional contributions cap is indexed to average weekly ordinary times earnings (AWOTE) in $2,500 increments. The concessional contributions cap will be indexed from $27,500 to $30,000 from 1 July 2024.
NON-CONCESSIONAL CAPS
The non-concessional contributions cap is calculated as four times the concessional contributions cap. So from 1 July 2024 the non-concessional contributions cap will be $120,000.
| Super balance (at 30 June 2024) |
Bring-forward rule non-concessional contributions caps |
Bring-forward rule timeframe |
| Less than $1.66m | $360,000 | 3 years |
| $1.66m – $1.78m | $240,000 | 2 years |
| $1.78m – $1.9m | $120,000 | 1 year |
| More than $1.9m | 0 | n/a |
|
Key superannuation threshold changes |
Previous threshold | New threshold |
|---|
| Concessional contributions cap | $27,500 | $30,000 |
| Non-concessional contributions cap | $110,000 | $120,000 |
| Non-concessional contribution bring-forward | $330,000 | $360,000 |
| General superannuation guarantee rate | 11.00% | 11.50% |
THE BRING FORWARD LIMIT
The two- and three-year bring forward limit will also increase to $240,000 and $360,000 respectively from 1 July 2024.
The bring-forward rule rule allows you to boost your retirement savings in super’s tax-friendly environment by rolling up to three years’ worth of after-tax contributions into a single year. You not only fast-track your retirement savings but you have the potential to benefit from the power of compound interest.
WHAT IS THE DIFFERENCE BETWEEN CARRY FORWARD RULE AND BRING FORWARD RULE?
The carry forward rule only applies to before-tax contributions and relates to rolling over portions of unused limits from previous years into this financial year. You can carry forward unused limits from up to five years ago.
The bring forward rule on the other hand, applies to after-tax contributions, and brings your future limits forward, so that you can use them earlier. How much you can bring forward and from when will depend on your super balance.