Is (Concessional) Superannuation Contribution Based on When Salary Was Paid or Based on When It Was Deposited by The Employer

bunkr on 20/06/2024 - 15:58
Last edited 20/06/2024 - 17:17 by 1 other user

I have a question and was wondering if someone knew the answer to this. Let me explain a bit more.

Say I was paid salary in current financial year ending 30 June 2024. However the employer actually deposits super against this salary into my superannuation account in next financial year. In that case, does this concessional contribution get considered in the FY 2023-24 or FY 2024-25.

Reason is that I am trying to maximise the concessional contribution, including using up some which I have available from 5 years ago. To that effect, I have been making salary sacrifice. That why, the period when the concessional contribution is applied impacts how much extra payments I can make, and how I plan for this financially.

I tried using my google-fu skills, but came up short. Perhaps I am now entering the correct terms. Can anyone enlighten me on this topic. Cheers.

Financial Superannuation

Comments

  • jv on 20/06/2024 - 16:03
    +2

    No idea sorry….

    • MS Paint on 20/06/2024 - 16:20
      +1

      I removed it's legs because still no idea

      • cashless on 20/06/2024 - 23:24

        And if you remove its genitals you'll still have no f(ropanity) idea

  • JohnSy on 20/06/2024 - 16:12
    +10

    If it was deposited by your employer into your account after July 1st then it would be applied to your account in the next financial year. It would therefore count against your next year's concessional contribution caps.

    Mygov will show your some of your available carry-forward limits. I have personally found it doesn't take into account the past year or so, so its only useful for those earlier carry forward amounts. The later carry forward stuff (like last financial year for me) need to be added in manually.

    In June each year, if you have a SMSF you may also be able to take advantage of Contribution Reserving, where you claim a deduction this financial year, and it doesn't get counted towards your concessional limit until next financial year. (https://www.esuperfund.com.au/learn/contributions-to-smsf/pl…). Contribution Reserving can also be used to move employer contributions made during June into next year's contribution limits.

  • Dollar General on 20/06/2024 - 16:15
    +5

    When super is paid into your account

    • JimB on 20/06/2024 - 16:16
      +6

      Nearly correct.

      It's actually when it's been received and applied to your account by your superannuation fund.

      • Dollar General on 20/06/2024 - 16:16
        +3

        Same same

        • JohnSy on 20/06/2024 - 16:17
          +1

          Actually it is not always the same same. (lookup Contribution Reserving).

        • JimB on 20/06/2024 - 16:17

          Did you edit your answer (1st post)?

          • Dollar General on 20/06/2024 - 16:18

            @JimB: Yes. Maybe at the same time you were typing your response

            • JimB on 20/06/2024 - 16:18

              @Dollar General: haha thought so.

            • JimB on 20/06/2024 - 16:31
              +1

              @Dollar General: I was pretty sure that your original answer that I replied to was incorrect.

              Your updated answer is correct enough.

  • soan papdi on 20/06/2024 - 16:44

    Few things to note:
    - to avail the carry over, you should first exceed the current FY limit of $27,500.
    - mind the 15% tax applied. If you have available carry over of say $10,000 (check ATO), you should deposit $11,764. If you have $5,000 pending in the current year, you should pay (5000+10000)/.85 = $17,647 so that you get $15,000 into the super account. (mod edit)
    - ensure you submit the notice of intent before EOFY, each Super will have their own cut off dates.

    • bunkr on 20/06/2024 - 16:47
      +1
      • mind the 15% tax applied. If you have available carry over of say $10,000 (check ATO), you should deposit $11,764. If you have $5,000 pending in the current year, you should pay (5000+10000)/.85 = $17,647 so that you get $15,000 into the super account.

      Whoa, you learn something new every day! I have always assumed that the limit of $27,500 is pre-tax concessional limit, not post-tax.

      • soan papdi on 20/06/2024 - 16:50

        This is because the personal contribution you put in is treated like pre-tax income (similar to salary sacrifice) when your returns are calculated.

        I also wish the ATO used funds first for carryover before current FY, would make it easier to fill our super.

        • bunkr on 20/06/2024 - 16:54

          Yeah 100% agree on using the carry-over first. The way they use current year first, and then backfilling from oldest carry-over year confused me initially.

    • Zeph101 on 20/06/2024 - 16:51

      Also, note that you MUST complete a valid intent to claim a tax deduction to the fund that originally received the contribution and received the acceptance notice from the fund, before any rollovers or start a pension phase account or the contribution will remain non-concessional.

      • xylarr on 21/06/2024 - 08:41

        Yes, don't get caught out rolling out your account to another fund just before the EOF, erasing your ability to submit a NOI. This includes partial rollovers.

        Basically the fund needs to have the whole of your personal contribution.

    • SBOB on 20/06/2024 - 17:48

      This is good info. I didn't consider this when making some significant catch up payments a week ago so might need to do some maths and work out what catch up balance I've not accounted for.

      • soan papdi on 20/06/2024 - 18:59
        +1

        @bunkr and @sbob, my advice is incorrect! My apologies. The 27,500 limit is pre-tax, so @bunkr was right. See https://www.unisuper.com.au/super/grow-your-super/caps-on-su…

        Before-tax super contributions cap

        You can generally contribute up to $27,500 each financial year (as of the 2023-24 financial year). These contributions are taxed at 15%.

        Essentially, whatever is deposited is the contribution but your Super sends 15% over to the ATO.

  • svs500 on 20/06/2024 - 16:45

    i just found out today you can check your concessional contribution rollover balance from the last 5 FY by logging into mygov -> ATO. Might be of help.

    • bunkr on 20/06/2024 - 16:50

      Yeah, I found this myself last year when clicking though on MyGov. Used this information to calculate how much can concessional + carry-over do I have available.

  • theycallmeXYZ on 20/06/2024 - 16:51

    also, keep in mind in order to be eligible to use carry forward from unused concessional (before-tax) contribution caps from previous 5 years your:
    • super balance needs to be under $500,000 - but unlike taxes, fees and charges this amount is not automatically increased each year to adjust for inflation, infact this amount has never been increased since 2017

    • including employer SG payments, the max limit of all concessional (before-tax) contributions from 1July2024 is $30,000, plus any carry forwards from previous 5 years
    This is general advice only

  • JimmyF on 20/06/2024 - 16:52
    +1

    Is (Concessional) Superannuation Contribution Based on When Salary Was Paid or Based on When It Was Deposited by The Employer

    What did your super fund say when you called them?

    • bunkr on 20/06/2024 - 16:55
      -2

      Why would I do that?
      /s

      • JimmyF on 20/06/2024 - 17:20
        +1

        Dunno, thought they might have known the best place for you to find the answer or something like that.

        • bunkr on 20/06/2024 - 22:54

          Sorry, was being sarcastic but I guess that didn't filter through on text. I agree, I just posted the question here. You are right, my Super or ATO is probably the best place for me to get this advise.

          • tonka on 20/06/2024 - 23:21
            -1

            @bunkr: Sadly you can get a variety of random answers from government advice. Recently was a bit surprised by how much I had to help a ATO super auditor to understand OTE.

  • tonka on 20/06/2024 - 21:51

    When it's received by the super fund.

  • andrek on 21/06/2024 - 08:48

    A slightly separate, but related topic: FY24 will the first year after which unused concessional cap carry forward amounts will start to drop off and if you want to use up unused amounts from FY18 (and potentially reduce your taxable income) - review your unused contributions from FY18 and consider contributing that extra to your super. You have less than a week to do so.

    • bunkr on 21/06/2024 - 09:32

      @andrek What does this mean. Are you saying that the carry-forwards caps are going away. Or do you mean that carry-forward amount from FY18 will become unavailable after June 30 as we finish the current FY?

      • andrek on 24/06/2024 - 07:17

        The second one. You can carry forward only the last five years of unused caps. As this rule was put in place in 2018-2019, the next FY will be the first time when the oldest of those unused caps becomes older than five years, so it's use it this FY or lose it.

  • BigBirdy on 21/06/2024 - 08:55
    +1

    It’s when your super fund receives it, so you won’t know for sure until after EOFY. To deal with this delay, you can make a (largish) super contribution now, then later when you know, declare to the ATO which component of your contribution is concessional with the balance as non-concessional. You can make that declaration anytime before the earliest of EOFY next year and submitting your tax return. The declaration is known as a “notice of intent to claim a tax deduction”.

  • ColtNoir on 21/06/2024 - 09:20

    Check your myGov.

  • pandadude on 21/06/2024 - 11:40

    Depends on lot of factors. You could have a self managed fund for which the rules are different to anyone who has a regular super fund.

    If you have the funds to worry about the 5 year rule then you really should speak to a professional. If you mess it up good luck as you will need to pay additional tax.

    At the minimum you can check mygov to see if you have any balance and factor in any deposit your employer plans to pay this month if any.

  • 2esc on 21/06/2024 - 12:49

    The quicker the money gets into the account the quicker it can earn you money to increase your super balance.

    Dont know if they still do it but my brother in law worked on a mine site many years ago where they had negotiated that the super for each days work was deposited the following day.

    • tonka on 21/06/2024 - 14:33
      -1

      That doesn't even sound possible and likely that much of an admin disaster it would be riddled with errors.

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