This information is of particular importance to high-earners who have more than one employer.
Many high earners are paying ‘excess contributions tax’ each year. The taxpayer is charged an additional 31.5% tax when they exceed the $25,000 per year cap on superannuation contributions from their employers.
From the 1st of Jan 2010, individuals that are eligible can apply to opt-out of receiving super guarantee from some of their employers in order to avoid unintentionally going above the concessional contributions cap.
Eligible individuals must meet the following criteria:
- have more than one employer; and
- you expect your employers mandated concessional super contributions to go over your concessional contributions cap for the financial year.
Apply to the ATO to opt-out
Individuals may be eligible to opt out if they have more than one employer and expect that their concessional super contributions will exceed the contributions cap for the financial year.
A separate application is required for each financial year.
**Important note - there may be very good reasons for the additional contributions being made into your fund. Before taking action, it’s always best to speak to a financial advisor who can provide guidance on this.