When Payday super arrives, your employer contributions will land more regularly. However for most Australians, employer payments alone won’t be enough for the retirement they really seek.

This is where understanding the types of contributions (and the tax rules around them) can help you boost your super safely, without accidentally breaking any limits.

1. Three main ways money goes into your super

Think of super contributions in three buckets – all go into the same account, however they’re treated differently for tax:

1. Employer contributions (Super Guarantee)
2. Salary sacrifice contributions
3. Personal contributions (money from your after tax income)

Employer contributions – the starting point

• Your employer must pay the compulsory Super Guarantee (SG) – currently 12% of your eligible earnings from 1 July 2025 onwards.
• These count as before tax (concessional) contributions and are taxed at 15% inside your super fund (or more if you’re a very high income earner).
• You don’t have to do anything to set them up, however you do need to check that they’re being paid correctly and showing up in your fund.

Salary sacrifice – redirecting some of your pay
Salary sacrifice is an arrangement where you agree to receive less take home pay and your employer pays the difference into your super instead.

• The sacrificed amount is also treated as a before tax (concessional) contribution and taxed at 15% in your fund, instead of your usual marginal tax rate (that may be higher).
• This can be tax effective if you’re on a middle or higher income and you don’t need that portion of your pay in your pocket right now.
• You must set it up with your employer payroll team – you can’t ‘salary sacrifice’ by simply transferring money directly to your super fund yourself.

Personal (after tax) contributions – topping up from your bank account
Personal contributions are amounts you pay directly from your after tax money (for example, from your savings).

• These are usually non-concessional (after tax) contributions – money that has already been taxed at your normal income tax rate.
• In some cases, you can choose to claim a tax deduction for a personal contribution and turn it into a concessional contribution. To do this, you must lodge a valid notice with your fund and meet the rules and timing requirements.
• For some lower and middle income earners, after tax contributions may also help you qualify for the Government co-contribution (if you meet the eligibility criteria).

2. Tax basics: concessional vs non-concessional caps
Here’s the high level view, without the jargon overload.

Concessional contributions (before tax)

• Include: employer SG, salary sacrifice and any personal contributions you claim a tax deduction for.
• Taxed at 15% inside your fund (or a bit more if you have very high income).
• There is an annual cap (a maximum you can put in each year at concessional rates). If you go over this cap, extra tax can apply and the ATO may ask you to withdraw some of the excess.
• In some situations, you can use ‘carry forward’ concessional cap amounts from previous years if your total super balance is under certain thresholds – this is where personalised advice really starts to matter.

Non-concessional contributions (after tax)

• Include: personal contributions that you don’t claim a tax deduction for.
• Not taxed when they go into your fund (because you’ve already paid tax on the income). However, investment earnings on them are taxed concessionally in super.
• There is a separate non-concessional cap each year. If you exceed it, the tax consequences can be quite painful (extra tax and potentially needing to withdraw the excess).
• There are ‘bring forward’ rules that sometimes allow you to contribute more than one year’s worth at once – however only if you meet age and balance tests. Again, this is adviser territory, not DIY guessing.

The big takeaway
Super can be very tax friendly, however the caps and rules are real.

If you’re thinking of making significant extra contributions, don’t wing it. Reach out to speak to our advisers.

3. Simple, safe ways to boost your super
Here are some common, relatively straightforward strategies people consider:

• Ask payroll whether you can start a small salary sacrifice amount each pay (for example, $20–$50 per week) and see how it feels in your budget.
• Make a small personal after tax contribution when you have surplus cash – such as from a bonus or tax refund – if it fits your broader financial position.
• If you have a partner on a lower income, explore whether spouse contributions or contribution splitting may be available and tax effective for your household.
• Do a quick ‘super tidy up’ once a year. Check:
  – your fund
  – your investment option
  – your insurance
  – your contributions

  to make sure everything still matches your situation.

None of these should be done in isolation. They need to make sense alongside your debt, savings, insurance and lifestyle needs.

4. When it’s worth talking to a licensed adviser
There are some clear trigger points where obtaining professional help is sensible rather than optional:

• You’re thinking about salary sacrificing a meaningful chunk of your pay and need to understand the real world impact on your take home income and tax.
• You’re planning to make large one off contributions (for example, from an inheritance, business sale or property sale) and need to navigate the caps and ‘bring forward’ or ‘carry forward’ rules.
• You’re within 10–15 years of the age you plan to retire and aim to model different contribution levels and retirement incomes.
• You have multiple funds, complex insurance or a high account balance and you’re not sure whether your current arrangement still suits you.

Licensed financial advisers can:

• Help you work out an appropriate contribution level based on your goals, cashflow and risk profile.
• Check you’re staying within the contribution caps and using any available rules to your advantage.
• Explain how any strategy interacts with Centrelink, tax and your other assets.

5. A sensible next step
If Payday super is making you think more seriously about your retirement savings, that’s a good thing.

The safest next step is simple:

1. Make sure your super fund and contact details are up to date.
2. Decide whether a small extra contribution (via salary sacrifice or after tax) fits your budget.
3. If you’re unsure, talk to our licensed adviser before changing your contribution strategy.