Super Contribution Caps 2026-27: Concessional and Non-Concessional Limits
The ATO sets strict annual limits on how much you can contribute to super in a tax-advantaged way. Exceed the $30,000 concessional cap or the $120,000 non-concessional cap in 2026-27 and you face penalty tax on the excess — but stay within them and you are using one of Australia's most powerful tax shelters. Here is exactly how the caps work, what counts toward each, and how to use them strategically.
Concessional Contributions: The $30,000 Pre-Tax Cap
Concessional contributions are contributions made from pre-tax income that are taxed at 15% inside your super fund rather than at your marginal income tax rate. The 2026-27 concessional cap is $30,000 per person per financial year — and this cap applies to the total of all concessional contributions across all your super funds combined.
Three types of contributions count toward the concessional cap:
- Employer SG contributions — the mandatory 12% from 1 July 2026. On a $100,000 salary, this contributes $12,000 against your cap.
- Salary sacrifice contributions — additional pre-tax contributions arranged with your employer that redirect part of your salary into super.
- Personal deductible contributions — contributions you make yourself (from your bank account, using after-tax money) and then claim as a tax deduction via a "Notice of Intent to Claim a Deduction" form submitted to your fund before lodging your tax return.
The tax saving from concessional contributions is substantial. A person in the 32.5% tax bracket (income between $45,001 and $135,000) pays 32.5% + 2% Medicare = 34.5% marginal rate. Concessional contributions to super are taxed at 15% instead — a saving of 19.5 cents per dollar. On a $10,000 salary sacrifice contribution, this saves $1,950 in tax annually.
For high earners with adjusted taxable income above $250,000, an additional "Division 293 tax" of 15% applies, bringing the effective tax rate on concessional contributions to 30%. Even at 30%, this is still below the 47% top marginal rate (45% + 2% Medicare), representing a 17-cent saving per dollar.
What Happens If You Exceed the Concessional Cap?
Exceeding the $30,000 concessional cap is not disastrous, but it is avoidable and creates extra tax administration. When you exceed the cap, the ATO issues an excess concessional contributions determination. The excess amount is included in your assessable income and taxed at your marginal rate — effectively reversing the 15% super tax and applying your full marginal rate.
You do receive an offset equal to 15% of the excess (representing the tax already paid by your fund), which partially compensates for the fund-level tax. Additionally, 85% of the excess amount can be released (withdrawn) from your super to help pay the tax bill — the remaining 15% stays in the fund as it cannot be refunded (it has already been taxed).
Critically, excess concessional contributions count toward your non-concessional cap for that year, which can inadvertently push you over the $120,000 non-concessional limit as well if you are not careful. Monitoring your contributions throughout the year via myGov or your fund's member portal is the simplest way to avoid breaching the cap.
Non-Concessional Contributions: The $120,000 Post-Tax Cap
Non-concessional contributions (NCCs) are contributions made from money that has already been taxed — your after-tax savings, an inheritance, a property sale, or other personal funds. These contributions go into your super tax-free because tax has already been paid; they form part of the tax-free component of your super, which is never taxed on withdrawal at any age.
The 2026-27 NCC cap is $120,000 per year. You cannot make NCCs if your Total Super Balance (TSB) at 30 June of the previous financial year was $1.9 million or more.
For those below $1.9 million TSB, eligibility for the bring-forward rule depends on your balance:
- TSB below $1.58 million: can bring forward 3 years of NCCs ($360,000 over 3 years)
- TSB between $1.58 million and $1.70 million: can bring forward 2 years ($240,000 over 2 years)
- TSB between $1.70 million and $1.90 million: can make only 1 year's worth ($120,000 in one year, no bring-forward)
- TSB $1.90 million or above: cannot make any NCCs
The bring-forward rule is triggered automatically when you contribute more than $120,000 in a single year. Once triggered, it locks in a 3-year period during which you cannot exceed the $360,000 cumulative cap. Age restriction: you must be under age 75 to make non-concessional contributions (and under 67 without needing to meet a work test prior to the work test removal).
What Happens If You Exceed the Non-Concessional Cap?
Exceeding the NCC cap triggers a significant penalty. The ATO issues an excess NCC determination, and you must either withdraw the excess (plus an associated earnings amount) from your super fund or have it taxed at the top marginal rate of 45% inside the fund.
In practice, almost everyone withdraws the excess rather than paying 45% tax on it. You have 60 days from the determination to make the withdrawal. If you withdraw the excess amount plus the calculated associated earnings amount, the associated earnings are included in your assessable income and taxed at marginal rate (with an offset for the 15% already paid by the fund).
Excess NCCs most commonly occur when people receive an inheritance or property sale proceeds and contribute a large lump sum to super without checking their TSB and bring-forward position first. A quick check via myGov before making any large NCC is essential.
Super Contribution Caps and Limits Summary 2026-27
| Contribution Type | 2026-27 Cap | Tax Treatment | Excess Tax Rate |
|---|---|---|---|
| Concessional (total: employer SG + salary sacrifice + personal deductible) | $30,000 | 15% in fund | Marginal rate (less 15% offset) |
| Non-concessional (personal after-tax) | $120,000 | Nil (tax-free component) | 45% (or withdraw excess) |
| Non-concessional bring-forward (3 years, TSB < $1.58M) | $360,000 | Nil | 45% (or withdraw excess) |
| Government co-contribution (personal NCC, income < $43,445) | $500 government match | Nil | N/A |
| Spouse contribution (for tax offset) | $3,000 (for full $540 offset) | Nil (post-tax) | N/A |
| Low Income Super Tax Offset (LISTO) | $500 maximum | Government refund of 15% contribution tax | N/A |
The Carry-Forward Concessional Contribution Rule
From 1 July 2018, Australians with a Total Super Balance below $500,000 can carry forward unused concessional cap space from the previous five financial years and use it in a single year. This is one of the most valuable yet underutilised provisions in the super system.
Carry-forward amounts accumulate as follows: if you had $15,000 in SG contributions in 2021-22 (cap was $27,500), you have $12,500 of unused space from that year. Unused amounts from 2021-22, 2022-23, 2023-24, 2024-25, and 2025-26 can all be used in 2026-27 — subject to the $500,000 TSB threshold being met at 30 June 2025.
The carry-forward rule is particularly valuable for people who have had: career breaks, maternity or paternity leave, periods of self-employment with low contributions, or years of part-time work. It is also highly useful for those who receive a large bonus, sell a business, or otherwise have an unusually high-income year and want to accelerate super contributions to reduce taxable income.
To check your available carry-forward amounts, log into myGov and navigate to ATO Online Services → Super → Unused concessional contributions. The balance shown there is the maximum additional concessional contribution you can make on top of the current year's $30,000 cap.
Strategic Use of Contribution Caps
Salary sacrifice to the cap: If your employer contributes $12,000 in SG on a $100,000 salary, you have $18,000 of concessional space remaining. Salary sacrificing $18,000 saves approximately $3,510 in income tax per year at the 34.5% marginal rate (compared to 15% super tax). This puts $18,000 into your super for a net take-home cost of $14,490.
Personal deductible contributions: If you are self-employed, a contractor, or your employer will not arrange salary sacrifice, you can contribute personally and claim a tax deduction. The process requires lodging a "Notice of Intent to Claim a Deduction" with your super fund before lodging your tax return — missing this step means the contribution is treated as non-concessional.
Last-minute top-ups before 30 June: Each year's concessional cap cannot be carried forward — it either uses the current-year cap or is lost. If you are approaching retirement, have received a bonus, or simply want to boost your super before year end, a personal deductible contribution up to the cap is one of the most effective strategies available.
Combining spouse splitting with NCC strategy: Super splitting allows you to redirect up to 85% of your concessional contributions to your spouse's super each year. This does not affect the caps — the contributions are counted against your cap in the year made, then split. The benefit is equalising balances and potentially enabling both spouses to each use their NCC caps independently.
Frequently Asked Questions
- Do employer SG contributions count toward the concessional cap?
- Yes. All employer contributions — mandatory SG and any additional employer contributions — count toward your $30,000 concessional cap. If your employer contributes $25,000 in SG (on a $208,000 salary), you only have $5,000 of cap space remaining for salary sacrifice or personal deductible contributions.
- Can I make non-concessional contributions if I am retired?
- Yes, provided you are under 75 years old and your Total Super Balance at 30 June of the previous year was below $1.9 million. From age 67 to 74, you must meet the work test (40 hours of paid work in any 30-day period during the financial year) to make personal contributions — although from 1 July 2022, the work test was removed for non-concessional contributions for those aged 67–74.
- What is the concessional cap history — has it always been $30,000?
- No. The concessional cap has changed several times: it was $27,500 from 2021-22 to 2023-24, then indexed to $30,000 from 2024-25. Prior to 2017-18, older Australians (over 50 in some years) had a higher cap of $35,000. The cap is indexed in $2,500 increments to AWOTE and will likely rise above $30,000 in coming years.
- Does salary sacrifice affect my take-home pay for mortgage applications?
- Salary sacrifice reduces your assessable income for most purposes, including tax. However, most lenders assess borrowing capacity based on gross salary before salary sacrifice — speak to your lender or mortgage broker about how they treat salary sacrifice in serviceability calculations.
- Can I contribute to super if I am not working?
- Yes, under age 67, you can make personal non-concessional contributions without working. From 67 to 74, a work test or work test exemption applies for some contribution types. If you are not working, you cannot make personal deductible (concessional) contributions because you have no income to deduct against — but you can still make non-concessional contributions up to the $120,000 cap.
