Division 293 Tax: What You Need to Know
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- Division 293 tax is an additional 15% tax on concessional (before-tax) super contributions for individuals whose income and super contributions exceed AUD 250,000 in a financial year.
- The tax applies only to concessional super contributions, including employer Super Guarantee contributions, salary sacrifice amounts, and personal deductible contributions.
- Division 293 income includes more than just salary. It also considers taxable income, reportable fringe benefits, investment income, certain net investment losses, and employer super contributions when assessing eligibility.
- Although Division 293 increases the tax on eligible super contributions from 15% to 30%, superannuation remains one of Australia's most tax-effective retirement savings vehicles for high-income earners.
- Regularly monitoring your income and super contributions, reviewing salary sacrifice arrangements, and seeking professional tax advice can help minimize unexpected Division 293 tax liabilities and support long-term retirement planning.
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Book a Free ConsultationDivision 293 tax is an extra 15% tax applied to concessional super contributions if your income plus those contributions exceeds $250,000 in a financial year.
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