More super for eligible employees from 1 July 2023

Compulsory super contributions paid by employers went up this month. Here are 10 things you should know, including what it could mean for your take-home pay.

Super contributions employers are required to make increased from 10.5% to 11% of an eligible employee’s before-tax salary or wages at the start of this month.

These contributions are made under the government’s Super Guarantee (SG). 

1. What is the Super Guarantee? 

The Super Guarantee is a percentage of your before-tax salary or wages, set by the government, that your employer is required to contribute into your super.

The purpose of these contributions is to provide people with income during retirement, which you may receive in addition to the government Age Pension, depending on your situation.

2. Who’s eligible for SG contributions? 

Full-time, part-time and casual employees, including temporary residents are generally eligible. So are employees under 18, as well as private and domestic workers, working more than 30 hours a week, in addition to some contractors. 

Check your eligibility using the ATO’s tool - Am I entitled to super guarantee from my employer?

3. Will the increase affect my take-home pay? 

If you’re paid your salary plus super, generally you won’t see a reduction to the money you take home. 

If your pay package is inclusive of super, your employer may choose to reduce your pay to cover the increase in super contributions, or they may choose to cover the increase themselves. 

Check your employment contract to see how changes may affect you.

4. What if I'm self-employed? 

Compulsory contributions aren’t mandatory if you’re self-employed, so you could consider making voluntary contributions into your super.

If you make voluntary after-tax contributions into your super, you may be able to claim a tax deduction on these at tax time, in addition to other work-related expenses.

5. Are future SG rate increases expected? 

The SG rate is scheduled to increase in increments and gradually reach 12% by 1 July 2025.

6. When are SG contributions paid? 

SG contributions must be made at least four times a year on dates set by the ATO. Employers can choose to do this more frequently if they choose to.

From 1 July 2026, the government has proposed that all employers pay super at the same time they pay salary or wages. This is yet to become law.

7. How can I check I’m being paid the right amount? 

Check your super statements, call your super fund, or log into your super account to see what’s been paid.

If you haven’t received contributions from your employer and it isn’t resolved by your payroll team at work, you can submit an unpaid super enquiry with the ATO.

To calculate the amount of SG you should receive, check out the ATO’s estimate my super tool.

8. Are there limits on super contributions? 

There are concessional and non-concessional contributions and different caps apply to each.

The cap on concessional contributions, which SG contributions are one of, is currently $27,500 per year.

You may however be able to contribute more than this amount under what’s known as the carry forward rule, which could allow you to accrue unused cap amounts for up to five years.

Other concessional contributions include salary sacrifice contributions, which is an arrangement you might set up with your employer, and tax-deductible contributions.

If you exceed contribution caps, additional tax and penalties may apply.

9. What other things should I be aware of? 

If you’re nearing retirement, another thing that changed on 1 July this year was the transfer balance cap, which limits the amount of super savings you can transfer to a retirement pension. 

The cap is currently $1.9 million, or less, if you started a pension before this date. You can check out your transfer balance cap info in the ATO section of your myGov account.

10. Where can I find out more about 1 July changes? 

To find out what changes came in recently and how they might affect you, check out our article 5 super and pension changes that came in on 1 July 2023.

If you need advice, please speak to your financial adviser or use our find an adviser service to locate someone near you.