What Taxes Apply? 

What tax applies to superannuation?

Let's look at the tax that applies at the three main stages: 

When you contribute 

At the point of investing your money in superannuation, any contributions made from your after-tax income (including spouse contributions) are not taxed. These are referred to as Undeducted contributions. 

If you're self-employed, and claiming a tax deduction for the contributions, or, if your employer is claiming a deduction for contributing to superannuation for you, a maximum of 15% tax must be paid on these contributions.

While your money's invested 

Once your money is invested in superannuation, the fund pays a maximum of 15% tax on any income and profits it makes on its investments. This is probably a much lower rate of tax than you pay on any income and profits from investments you have outside superannuation. 

When you withdraw your money 

The tax you pay on withdrawal depends upon factors such as your age, when you started work or contributing to superannuation and the type of contributions that you made. 

For example: 

  • Undeducted contributions (your own contributions after July 1983 for which you haven't claimed a tax deduction) are repaid to you tax free. 
  • Post June-83 taxed element (the balance of your benefit, excluding undeducted contributions) is tax free providing you cash out after 60.

Disclaimer - The information contained on this website is given in good faith and has been prepared from information believed to be accurate and reliable. This information is of a general nature only. Mortgage One and its related entities, nor any of their employees, officers or directors gives any warranty of accuracy or reliability nor accepts any responsibility arising in any other way including by reason of negligence for errors or omissions herein. All assumptions and examples are based on the continuance of present laws and Mortgage One’s interpretation of them. Mortgage One does not undertake to notify recipients of changes in the law or its interpretation. This guide is not designed to be a substitute for specific financial or investment advice or recommendations and should not be relied upon as such. Please contact us for advice on your specific needs

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