Jump Start Your Super
If you qualify, the Government will now contribute $1.00 for every $1 of your personal superannuation contributions, up to $1,000. Known as the "co-contribution", it's a great way to boost your retirement savings.
To qualify in the 2009/2010 tax year, you will need to:
- make a personal contribution out of after-tax salary to a complying superannuation fund or a Retirement Savings Account (RSA)
- have an "assessable income" plus "reportable fringe benefits" of less than $61,920
- lodge an income tax return for the year of income
- not hold an eligible temporary resident visa at any time during the year
- be less than 71 years old at the end of the year of income
How much could you get?
For the 2009/2010 tax year, the maximum co-contribution of $1,000 will apply to earnings of $31,920 or less. The co-contribution cuts out when your income reaches $61,920.
From 2012, the maximum co-contribution rate will increase each year, reaching $1,500 by 2015 as set out in the table below.
| 2009 - 2010 |
100 |
$1,000 |
| 2010 - 2011 |
100 |
$1,000 |
| 2011 - 2012 |
100 |
$1,000 |
| 2012 - 2013 |
125 |
$1,250 |
| 2013 - 2014 |
125 |
$1,250 |
| 2014 - 2015 |
150 |
$1,500 |
The thresholds will be subject to indexation, but the maximum co-contribution is fixed at $1,000 under present legislation for this financial year.
How do you claim?
Easy as pie.
You don't even have to apply for the Co-Contribution. The Tax Office will calculate your entitlement using information from your superannuation fund and tax return.
If you make a voluntary contribution to RecruitmentSuper that is eligible for a Co-Contribution the government will make the Co-Contribution in the following tax year, as the amount of the Co-Contribution is based on information in your tax return. This means that if you make an eligible voluntary contribution in the 2009/2010 tax year, the Government will make the Co-contributions after you lodge your 2009/2010 tax return. So you should lodge your tax return as soon as you can.
Other considerations
Like your personal contributions, co-contributions will be treated as non-concessional contributions for taxation purposes. This means that they will not be subject to any taxation when paid to the fund and will not be taxed as an end benefit. The earnings on co-contributions will receive concessional tax treatment like any other earnings in your superannuation fund.
Personal contributions and co-contributions must be preserved in the fund, which means they can generally only be accessed when you reach your preservation age, or satisfy grounds for releasing your benefit.
So, if you earn less than $61,920 this tax year, you have a great opportunity to increase your superannuation savings with some welcome help from the government!
For more information
A fact sheet is also available through the ATO's website.
