Over the years, changes to superannuation laws have opened up more opportunities for people to boost their retirement savings, particularly in the later stages of their working life. If you’re still contributing to SASS, understanding how these rules work and how they interact with your defined benefit can help you make the most of what’s available.
Making the most of pre-tax contributions
The annual limit for pre-tax super contributions, known as the concessional contributions cap, was raised to $30,000 on 1 July 2024. This cap covers all contributions made from before-tax income, including employer contributions, salary sacrifice amounts, personal deductible contributions and notional employer contributions credited to defined benefit schemes like SASS. Keep in mind that if you choose to make any personal deductible contributions to another super fund outside of SASS after age 67, you will need to meet a work test. Why does this matter? For most people, income contributed to super is taxed at just 15%, which is often lower than their marginal tax rate. Contributing more within the cap can therefore reduce the tax you pay while building your retirement savings.
SASS members benefit from a long-standing special protection. If the combined value of your SASS contributions and your employer’s notional contributions exceeds the concessional cap, those contributions are still treated as being within the cap, provided you haven’t increased your contribution rate beyond the benefit category you held on 12 May 2009 or 5 September 2006. This protection is permanent unless you change categories, so it’s important to check your annual statement to confirm it still applies.
If you’ve reached the maximum of 180 accrued benefit points, your notional employer contributions generally reduce. In practical terms, this can create room under your concessional cap to make additional pre-tax contributions to another super fund, taxed at the concessional rate.
Using unused concessional caps
Another opportunity comes from the ability to carry forward unused concessional caps from previous years. If you haven’t used your full concessional cap in any of the past five financial years, you may be able to add the unused amount to your current year’s cap, provided your Total Super Balance (TSB) was below $500,000 at the previous 30 June.
For contributing SASS members, your TSB isn’t your contribution account balance. Instead, it reflects the value of your total superannuation interests, including the value of your defined benefit. This is generally assessed as the maximum lump sum you would have been entitled to if you had ceased employment at 30 June, which is shown as your withdrawal value on your annual statement. To learn more about your total super balance reported to the ATO see our SASS statement guide.
After-tax contributions and larger lump sums
If you have savings outside super, you may also be able to contribute using after-tax (non-concessional) contributions. The standard non-concessional cap is $120,000 per year, subject to your total super balance.
If your total super balance is below the relevant thresholds, you may be able to bring forward up to three years of non-concessional caps and contribute up to $360,000 in a single year. Because SASS doesn’t accept these contributions, they need to be made to another complying super fund.
Age-based rules still apply, and contribution eligibility can depend on timing and balances. These rules can be complex, so it’s important to understand how they apply to your specific circumstances.
Why advice matters
Understanding how these rules apply to your personal situation, particularly within a defined benefit scheme like SASS, can be complex.
That’s why it can be helpful to discuss your circumstances with an Aware Super financial planner. A planner can help explain how the limits apply to you and what options may be available as part of your broader retirement planning. Your first appointment with an Aware Super financial planner is free of cost or obligation. Book an appointment at aware.com.au/statesuperadvice or call 1800 841 633.