As Australians increasingly focus on building a secure retirement, catch-up concessional contributions have emerged as a smart way to maximise super balances – particularly for those with irregular work patterns, variable income, or who’ve only recently started prioritising their superannuation.
Whether you’re looking to boost your retirement savings, improve tax efficiency, or simply make up for lost time, this flexible strategy could help you make the most of the superannuation system.
What are catch-up concessional contributions?
Catch-up concessional contributions allow eligible individuals to carry forward unused concessional contribution caps from previous financial years and make additional contributions in a later year – without exceeding the annual limit.
Concessional contributions are those made to super before tax is applied, and include:
- Employer contributions (including the super guarantee)
- Salary sacrifice contributions
- Personal deductible contributions
As of FY 2024–25, the standard concessional contributions cap is $30,000 per year. If you haven’t used the full cap in previous years, you may be able to carry it forward and contribute more in a future year.
Who is eligible?
To qualify for catch-up contributions, you must:
- Have a total superannuation balance under $500,000 at 30 June of the previous financial year, and
- Have unused concessional cap amounts from one or more of the past five financial years, beginning with FY 2020–21.
Unused cap amounts can be carried forward for up to five years before they expire.
How does it work?
Here’s a simplified example of how the strategy can be applied:
Your concessional contributions were:
- FY 2020–21: $15,000 (unused: $10,000 based on the annual cap of $25,000)
- FY 2021–22: $20,000 (unused: $7,500 based on the annual cap of $27,500)
- FY 2022–23: $22,000 (unused: $5,500 based on the annual cap of $27,500)
- FY 2023–24: $20,000 (unused: $7,500 based on the annual cap of $27,500)
- FY 2024–25: $15,000 (unused: $15,000 based on the annual cap of $30,000)
Total unused contributions: $45,500
If your total super balance is under $500,000 at 30 June 2025, you could contribute your usual $30,000 plus the carried-forward $45,500 – for a total concessional contribution of $75,500 in FY 2025–26.
This approach can be particularly useful in a high-income year or when looking to manage tax following the sale of a business or other asset.
Why consider catch-up contributions?
Catch-up contributions offer several advantages:
- Tax efficiency: Concessional contributions are taxed at 15% within the fund—typically lower than your marginal tax rate.
- Boost your retirement savings: Make up for years when you couldn’t contribute as much.
- Flexibility: Allows larger contributions in years when it suits your financial circumstances.
What else should you keep in mind?
- You can only carry forward unused cap amounts for five years, after which they expire.
- If you exceed your concessional cap (even after catch-up), the excess may be taxed at your marginal rate, plus an interest charge.
- Your eligibility is linked to your total superannuation balance as at 30 June the previous year.
- You can check your available carry-forward cap via your MyGov account or ask your accountant to assist.
Looking to take advantage of catch-up concessional contributions?
Whether you’ve returned to the workforce, experienced a higher-earning year, or are planning your retirement strategy, catch-up concessional contributions could help you make the most of your superannuation and reduce your tax bill.
At LDB, our experienced team of superannuation specialists, tax accountants, and wealth advisors work together to help you plan ahead and grow your wealth with confidence.
Call us today on (03) 9875 2900 or get in touch online to speak to an LDB advisor about your eligibility, contribution strategy, and broader retirement planning goals.
