A contribution is a payment made to your fund in the form of money or an asset other than money (called an in specie contribution). Provided the governing rules of your fund allow it, your SMSF can generally accept:
- employer contributions
- personal contributions
- salary sacrifice contributions
- super co-contributions
- eligible spouse contributions.
You need to properly document contributions and rollovers – including the amount, type and breakdown of components – and allocate them to the fund members’ accounts within 28 days of the end of the month in which you received them.
There are minimum standards for accepting contributions to Super. Whether a contribution is allowable depends on:
- the type of contribution – for example, you can accept mandated employer contributions, such as super guarantee contributions from a member’s employer, at any time
- the age of the member – for example, you cannot accept non-mandated contributions from members aged 75 or over
- whether the member quotes their TFN
- whether the contribution exceeds the member’s fund-capped contributions limit.
These are minimum standards – the trust deed of your fund may have more rules around accepting contributions.
In specie contributions
In specie contributions are contributions to Super fund in the form of an asset rather than money or cash.
There are prescribed rules and limits to the amount of contributions you can make to your super each financial year.
It is important you are aware of these rules and limits and monitor the amount of contributions you make to all of your super funds each financial year. Any contributions which are over your caps are subject to additional tax.
Who can make contributions?
There are various tests for acceptance of contributions by the fund for respective age groups:
|Contribution type||Description||Under 182||Under 65||Over 65 but under 70||Over 70 but under 75||75 and over|
|Mandated employer contributions||SG and contributions made under an award or industrial agreement||Yes||Yes||Yes||Yes||Yes|
|Voluntary employer contributions||All other employer contributions other than mandated employer contributions including salary sacrifice and employer ETPs||Yes||Yes||Subject to work test requirements*||Subject to work test requirements*||No|
|Member personal contributions||Personal contributions made on an after-tax basis||Yes||Yes||Subject to work test requirements*||Subject to work test requirements*||No|
|Spouse contributions||Contributions made to a spouse‘s account and received from a spouse under contribution splitting rules||N/A||Yes||Subject to work test requirements*||No||No|
|Government co-contributions||Government payment which is applied to eligible personal contributions||Yes||Yes||Yes||No||No|
This information is a guide only as tax rules in relation to superannuation can be very complex, so we suggest that you seek professional advice before making any decisions.
2SG Contributions are not compulsory for employees under age 18 who are working less than 30 hours per week, and are paid less than $450 per month (subject to any overriding award or agreement).
*To meet the work test requirements a person must be gainfully employed i.e. employed or self-employed for at least 40 hours within 30 consecutive days in the financial year the contributions are made.