Spouse Super Tax Offset

By Stephen Vick

Newsletter | Superannuation | Wealth Building

There is a tax offset available for taxpayers who make contributions on behalf of a spouse who is earning a low income, or not working.

For contributions of up to $3,000 made for a spouse on a lower income, there is a tax offset of 18% available, providing the spouse’s income is less than $37,000. (The tax offset shades out above $37,000 and cuts out entirely once the receiving spouse’s income reaches $40,000.) The maximum tax offset is $540.

The benefits of making spouse contributions are:

  • Adding to your spouse’s retirement assets within a concessionally-taxed environment
  • There is no tax paid on entry to super for this type of contribution (a non-concessional contribution)
  • You will be eligible for a tax offset of 18% on contributions made up to a maximum of $3,000

Example: 

Jane makes a $2,000 contribution for Tarzan, her spouse whose taxable income for the financial year is $25,000. Jane will be entitled to a tax offset of $360 when she completes her tax return.

Our tip – if you have savings to spare and you have a spouse whose taxable income will be less than $37,000 in the current financial year, you might want to make a contribution before 30 June.

Note: Spouse contributions do not count as part of the $25,000 concessional contribution limit.

Things to be aware of:

  • If your spouse ends up earning more than $40,000 during the financial year you won’t be entitled to an offset
  • You won’t see the tax offset until you have completed your personal tax return for the current financial year
  • Funds you contribute will be preserved in super until your spouse meets a condition of release
  • By making a spouse contribution, the funds will be under the control of your partner and will not be accessible to you
  • Spouse contributions count towards the receiving spouse’s annual $100,000 non-concessional contribution cap
  • The tax offset only applies to the first $3,000 in spouse contributions made during a financial year. Contributions in excess of this amount will attract no additional tax benefit

Let us know if you have any questions or require assistance with any last-minute super contributions.

Disclaimer: The information in this email is general advice only and has not taken into account your personal circumstances. Please seek personalised advice prior to implementing any additional contributions.

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