Don’t miss out on tax savings. Top up by 3pm on 25 June (Sydney time).
When it comes to super, starting early can make a powerful difference. The earlier you understand how your super is tracking, the more time it has to work for you. And with EOFY approaching, there’s no better time to check in and make sure your super is in shape for the years ahead.
Want to maximise your tax savings this financial year? There’s still time! Top up by 3pm on 25 June (Sydney time) to ensure the transaction reaches us before the end of financial year.
You can contribute in less than a minute on the Commbank app or NetBank.
Make a contribution from your CommBank account
You can transfer funds from an existing CommBank transaction account to your Essential Super account easily using the CommBank app or NetBank.
- Log on to the CommBank app or NetBank and select your Essential Super account
- Click “Add to Super”
- Follow the prompts and select the applicable contribution type
Don’t forget, if you're claiming a tax deduction, you'll need to submit a Notice of Intent form after you top up to claim your benefit.
You can also make a contribution through another financial institution by using BPAY®.
Why should I top up my super?
Meet Gemma, 25
Gemma earns $1,500 per week and has around $30 left after all her expenses. She is thinking about making salary sacrifice contributions to her super to maximise her super when she eventually retires.
Gemma can ask her employer to make salary sacrifice contributions of around $44 per week (only $30 of her take home pay per week as these contributions are made before income tax). After 15% contributions tax, around $38 will be added to her super each week.
If Gemma continues this strategy for 40 years until she retires at 65, she could have $151,000 more in super then if she didn’t make any extra contributions. Thanks to the power of concessional taxation and compound returns, this is far more than the $62,000 in net income she’s given up during this time.
Meet Thomas, 39
Thomas earns a $90,000 annual salary and has $5,000 to invest. He's considering whether to invest it inside or outside super.
If Thomas invests the $5,000 outside super, his investment would grow to $9,400 (after tax) by the time he retires at age 65.
Instead, Thomas decides to make a personal tax-deductible contribution of around $7,400 to super. This only impacts his after tax money by $5,000 due to the tax deduction. As Thomas' investment is in superannuation, it is generally inaccessible until retirement. However, thanks to the power of concessional taxation and compound returns, he could have an extra $13,400 in super when he retires.
Meet Anna, 50
Anna earns $100,000 per year and has just received an inheritance of $300,000. She wants to use it to maximise her super balance (currently $600,000) for when she retires at age 65.
Firstly, Anna makes a tax-deductible contribution of $18,000 which uses her remaining concessional contributions cap after allowing for her employer’s compulsory contributions. This only reduces her after tax inheritance money by $12,200 (taking into account the tax deduction).
She then makes an after tax contribution of $287,800 using the ‘bring-forward’ rule.
By making these contributions, Anna’s super balance at age 65 would be $466,051 higher than if no additional contributions were made. This is substantially more than if Anna had invested her inheritance outside super ($422,000 at age 65).
Meet Chris, 55
Chris is aged 55 earning $80,000 pa salary with a current super balance of $300,000. He has around $80 of spare net income and wants to focus on maximising his super in the lead up to retirement at age 67.
Chris asks his employer to make salary sacrifice contributions of around $118 per fortnight (this will only reduce his take home pay by $80 per fortnight as these contributions are made before income tax is applied). After contributions tax of 15%, there will be around $100 added to his super investment each fortnight.
If Chris keeps this strategy up for 12 years until his retirement at age 67, he could have close to $36,700 more in super than if he didn’t make any extra contributions. Due to the power of concessional taxation and compound returns, this is substantially more than the net income he’s given up during this time.
Meet Paul, 60
Paul is aged 60 earning $100,000 pa salary, with a current super balance of $400,000. He has around $80 of spare net income and wants to focus on maximising his super in the lead up to his retirement at age 65.
Paul asks his employer to make salary sacrifice contributions of around $118 per fortnight (this will only reduce his take home pay by $80 per fortnight as these contributions are made before income tax is applied). After contributions tax of 15%, there will be around $100 added to his super investment each fortnight.
If Paul keeps this strategy up for 5 years until his retirement at age 65, he could have around $14,400 more in super than if he didn’t make any extra contributions. Due to the power of concessional taxation and compound returns, this is substantially more than the net income he’s given up during this time.
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*Transactions via BPAY must be made no later than 3pm on 25 June (Sydney time) to ensure the funds reach us by 30 June.
Assumptions for Gemma's case study: Marginal tax rate is 32% including Medicare levy. Superannuation earns 3.5% pa income (taxed at 15%) and 3.0% pa capital gain (taxed at 10%). Contributions indexed by 2.5% pa and assumed to be made mid-way through each year. Amounts shown are calculated in today’s dollars discounted for inflation of 2.5% pa.
Assumptions for Thomas' case study: Marginal tax rate is 32% including Medicare levy. Superannuation earns 3.5% pa income (taxed at 15%) and 3.0% pa capital gain (taxed at 10%). Non-super investment earns 3.5% pa income (taxed at marginal rate) and 3.0% pa capital gain (50% of gain taxed at marginal rate in final year when investments sold). Contribution / investment is assumed to be made mid-way through the first year. Amounts shown are calculated in today’s dollars discounted for inflation of 2.5% pa.
Assumptions for Anna's case study: Marginal tax rate is 32% including Medicare levy. Superannuation earns 3.5% pa income (taxed at 15%) and 3.0% pa capital gain (taxed at 10%). Non-super investment earns 3.5% pa income (taxed at marginal rate) and 3.0% pa capital gain (50% of gain taxed at marginal rate in final year when investments sold). Contributions / investments assumed to be made mid-way through the first year. Amounts shown are calculated in today’s dollars discounted for inflation of 2.5% pa.
Assumptions for Chris and Paul’s case study: Results in today's dollars. Projection done using ASIC Moneysmart Superannuation Calculator and using all default assumptions and a balanced investment option. Marginal tax rate is 32% including Medicare levy.
Important information
Avanteos Investments Limited ABN 20 096 259 979, AFSL 245531 (referred to as Colonial First State, CFS, ‘we’, ‘us’ or ‘our’) is the Trustee of Essential Super ABN 56 601 925 435 and the issuer of interests in Essential Super. Essential Super is distributed by the Commonwealth Bank of Australia ABN 48 123 123 124, AFSL 234945 (the Bank). The CFS Group consists of Superannuation and Investments HoldCo Pty Limited ABN 64 644 660 882 (HoldCo) and its subsidiaries, which includes CFS. The Bank holds an interest in the CFS Group through its significant minority interest in HoldCo.
This information is issued by CFS and may include general financial product advice but does not consider your individual objectives, financial situation, needs or tax circumstances, and so you should consider the appropriateness of the advice having regard to your circumstances before acting on it. The Target Market Determination (TMD) for Essential Super can be found at cfs.com.au/tmd and includes a description of who the financial product is appropriate for and any conditions on how the product can be distributed to customers. You should read the Product Disclosure Statement (PDS) and the Reference Guides for Essential Super carefully and consider whether the information is appropriate for you before making any decision regarding this product. Download the PDS and Reference Guides at commbank.com.au/essentialsuper-documents or call us on 13 4074 for a copy. None of the Bank, HoldCo, CFS, nor any of their respective subsidiaries guarantee the performance of Essential Super or the repayment of capital by Essential Super. An investment in this product is subject to risk, loss of income and capital invested. An investment in Essential Super is via a superannuation trust and is therefore not an investment in, deposit with or other liability of the Bank or its subsidiaries.