New Rules for Deducting Personal Super Contributions

Changes that took effect from 1 July 2007 means the rules for deducting personal contributions have changed. The basic rules are similar but have some important differences:

You are eligible to claim a deduction if:

  • you satisfy the ‘maximum earnings as an employee’ condition
  • you meet the age-related conditions
  • you made personal contributions to a complying super fund or a retirement savings account (RSA)
  • you made the contributions in order to obtain super benefits for yourself, or for your dependants in the event of your death
  • you have written to your super fund or RSA provider, in the approved form Deduction for personal super contributions (NAT 71121), and advised them of the amount you intend to claim as a deduction, and
  • your super fund or RSA provider has acknowledged your notice of intent and agreed to the amount you intend to claim as a deduction.

What is the ‘maximum earnings as an employee’ condition?

You can claim a deduction on personal contributions, even if you receive some income as an employee, as long as you satisfy the ‘maximum earnings as an employee’ condition.
Under this condition, the amount you earn as an employee must be less than 10% of your combined assessable income and reportable fringe benefits for that income year. This is the case regardless of whether you your employer has paid super on your behalf.

(source ATO)

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