Claim a tax deduction

A personal after-tax contribution you make to your super is recorded as ‘non-concessional’. But, if you lodge a Notice of intent to claim a tax deduction on all or some of that contribution,¹ the amount will be changed to a ‘concessional’ contribution and taxed at 15% within the super fund. Your concessional contribution will effectively reduce your taxable income — that means, you'll pay income tax on a reduced amount.

Non-concessional (after-tax) contributions and concessional (before-tax) contributions are taxed differently:

1. when received by the super fund and
2. when paid out from the fund.

Find out more about How your super is taxed.

To claim a tax deduction, you’ll need to be under age 75 and have met the work test² if you’re age 67 or over.

¹ Please note, if you meet the eligibility criteria to receive a government co-contribution, any amount claimed as a tax deduction will no longer qualify as an after-tax payment towards the government co-contribution.

² Work test: You are required to work at least 40 hours in 30 consecutive days in the financial year that the contribution is made.
Work test exemption: If your total super balance (as defined in the Important information section of this page) at the previous 30 June is less than $300,000, you will be exempt from this work test for 12 months from the end of the financial year in which you last met the work test. This exemption applies only once.

The amount that you claim as a deduction will count towards your concessional contributions cap³. So, you should consider if claiming a tax deduction will:

• attract Division 293 tax (which is an additional 15% tax on the contribution) if your income plus concessional contributions are over the $250,000 threshold
• impact whether you’ll go over your concessional contribution cap and attract additional tax
• affect your eligibility to receive a government co-contribution.

³ There is an annual general concessional contributions cap. Since 2018/19, you have been able to carry forward unused amounts of your concessional contributions cap for use in future years. The unused amounts can be accrued for up to 5 years and can be used to increase your cap in any year where you have a total super balance of less than $500,000 on 30 June of the previous financial year. You can view your concessional contributions cap through myGov.
Please see our fact sheet Salary sacrifice and save for more details. 

You can only claim a tax deduction on a contribution amount up to your concessional contributions cap.³ Any contributions above that amount should be kept as after-tax contributions, and the relevant rules and limits will apply.

Don’t forget, if you’re receiving super guarantee (SG) contributions from your employer or have a salary sacrifice arrangement in place, those contributions will also count towards your concessional cap. A little bit of planning can help you ensure you don’t breach the cap and risk paying a penalty on excess amounts. If you’re unsure, it’s a good idea to seek professional advice.

The timing of your Notice of intent to claim a tax deduction lodgement is crucial. You need to be aware of the following scenarios to ensure your tax deduction claim is successful — otherwise, your contribution could be considered as ‘after-tax’ and the relevant after-tax contribution caps and tax will apply.

Lodge your Notice of intent to claim a tax deduction and await confirmation from us before:

• you lodge your tax return for the relevant financial year
• withdrawing any money from your super account
• rolling your super account to another fund
• closing your super account
• transferring your super account to an income stream account, like the NGS Transition to retirement or NGS Income account.