Access to the Superannuation Non-Concessional Bring Forward Cap Expanded

Although the standard non-concessional superannuation contribution cap is set at $110,000 annually, if you are under 65 years of age at any time in a financial year you make the contribution, you may be able to make non-concessional contributions of up to three times the annual non-concessional contributions cap in that financial year (maximum of $330,000 from 1 July 2021…$110,000 x 3). This is known as the bring-forward cap. Note in last year’s Budget there was a proposal to increase the access age to 67, however this has not yet been legislated.

The benefit of the bring-forward cap is that it allows you to contribute large amounts into superannuation as soon as possible and therefore enjoy the concessional superannuation tax treatment on the earnings on those amounts as early as possible. This cap is not just for the wealthy but is often utilised by taxpayers when they receive a windfall cash amount for example a compensation payment, a pay-out from work, an inheritance, or the proceeds from the sale of a high-value asset.

As announced in the 2021 Federal Budget (though somewhat hidden away from the headlines) from 1 July 2022, individuals aged 65 to 75 will also be able to access the bring-forward cap even if they do not work. This will enable older Australians to make provision for their retirement by injecting large sums into superannuation more quickly than under the current rules.