Catch-up super contributions

An exciting change to superannuation contributions which are relevant from 1 July 2019, are that eligible individuals may be able to make concessional contributions (CCs) above the annual cap, by utilising concessional cap amounts that were accrued and carried forward from 1 July 2018. This means individuals who did not have any CCs in the 2019 financial year may be able to make CCs of up to $50,000 in the 2019/20 year.

Similarly, if the concessional cap is not utilised in the current financial year, the unused portion of the cap can be carried forward and potentially used in future years. For example, if a client’s CCs were $15,000 in 2018-19, that client may contribute CCs of up to $35,000 in 2019-20, or in a following year up to and including 2023-24 provided their TSB is less than $500,000 just before the start year the contribution is made.

It is important to note that these amounts aren’t only carried over for the following financial year, the amounts are carried forward on a five year rolling basis. Unused amounts which have not been utilised within five years will expire.

To make use of carried forward CCs in the 2019/20 financial year, an individual’s Total Superannuation Balance (TSB) must not have exceeded $500,000 on 30 June 2019. This requirement will need to be met going forward on the 30 June prior to the year in which the person wishes to make the catch-up contribution.

The catch up arrangement may be beneficial including where an individual:

  • has realised a capital gain and is aiming to reduce or offset the capital gains tax liability by making a
    personal deductible contribution
  • has not been working for some time, has not made or received CCs during that time and is planning to
    catch up, or
  • wishes to split CCs to a spouse, by effectively enabling a larger amount to be split.

Strategy opportunities

  1. Accumulating unused cap amounts: Contributions made in excess of the annual CC cap, where a person has unused cap amounts from one of the five prior financial years, will be deducted from unused amounts from the earliest to the latest financial year. Unused amounts which have not been utilised within five years will not be available to carry forward.
  2. Catch-up contribution CGT offset strategy: The catch-up regime creates a planning opportunity for many individuals. For example, individuals who are retired and do not receive SG, under the age of 65 and only have passive investment income may benefit from seeking financial and tax advice, to consider whether any tax efficiencies can be created by carefully planning when disposing of assets.

Hopefully the above gets your mind thinking about opportunities to use this strategy in your own financial plan and if you want to discuss any of the details above or the application to your situation then please contact me at


Pete Pennicott | Principal Adviser

Wealth Collective trading as Pekada (ABN 95 624 612 684), corporate authorised representative (CAR), number 1263725, is authorised to provide financial services on behalf of Communitas Wealth Pty Ltd.

The information provided on this website is general in nature and does not constitute advice. You need to consider with your financial situation and your particular needs prior to making any strategy or products decision. Pekada will endeavour to update the website as needed. However, information can change without notice and Pekada does not guarantee the accuracy of information on the website, including information provided by third parties, at any particular time Unless otherwise specified, copyright or information provided on this website is owned by Communitas. You may not alter or modify this information in any way, including the removal of this copyright notice.