Super contribution caps 2026–27 and the carry-forward rule most people miss

Superannuation is the most reliable tax deduction available to most employees, and the one most of them never use. The rules changed on 1 July 2026 — the caps went up — so it is worth knowing where you stand.

The caps for 2026–27

Concessional (before-tax) cap: $32,500 — up from $30,000 in 2025–26
Non-concessional (after-tax) cap: $130,000 — up from $120,000
General transfer balance cap: $2 million
Lifetime CGT cap: $1,935,000

Concessional contributions include your employer’s super guarantee, any salary sacrifice, and personal contributions you claim as a deduction. They are taxed at 15% in the fund rather than at your marginal rate.

The deduction employees keep missing

You do not need a salary sacrifice arrangement to get the tax benefit. You can make a personal contribution from your after-tax money and claim it as a deduction in your return.

The mechanics matter, and this is where it goes wrong:

Make the contribution to your fund before 30 June, allowing enough time for it to be received — a contribution that lands on 2 July counts for the following year
Lodge a notice of intent to claim with your super fund
Receive written acknowledgement from the fund
Only then claim the deduction in your return

Miss the notice of intent, or lodge it after you have already lodged your return, started a pension or rolled the money to another fund, and the deduction is gone. The money stays in super either way — you just do not get the deduction. It is an entirely avoidable loss and we see it every year.

Carry-forward: the rule worth understanding

If your total superannuation balance was under $500,000 at 30 June of the previous year, you can carry forward unused concessional cap from the previous five years and use it in a later year.

Unused amounts start from 2018–19 and expire after five years. A 2019–20 unused amount that was not used by the end of 2024–25 has already expired.

This is genuinely valuable in a year where your income spikes — a capital gain on an investment property or share parcel, a redundancy payment, a bonus, or a business sale. Someone who has been contributing only the employer minimum for several years can have a large accumulated cap available in exactly the year they most need a deduction.

Someone with $60,000 of unused cap carried forward, in a year they realise a large capital gain, can contribute and deduct well beyond the annual $32,500 — converting income taxed at up to 47% into contributions taxed at 15%.

You can check your available carry-forward amount in ATO online services through myGov.

Watch for Division 293

If your income plus concessional contributions exceeds $250,000, an additional 15% tax applies to some or all of your concessional contributions. The concession is still worthwhile at 30% versus a 47% marginal rate — but the arithmetic is different, and worth running before you contribute a large amount.

Going over the cap

Excess concessional contributions are included in your assessable income and taxed at your marginal rate, with a 15% offset for the tax already paid in the fund. It is not catastrophic, but it removes the benefit entirely.

The most common cause is forgetting that employer contributions count. If your employer contributes $18,000, your remaining room is $14,500, not $32,500. Multiple employers make this easy to get wrong.

Other things worth knowing

Spouse contributions may attract a tax offset where your spouse’s income is low
Government co-contribution may be available for lower-income earners making after-tax contributions
Bring-forward lets those under 75 contribute up to three years of non-concessional cap in one year, subject to their total super balance
Downsizer contributions from the sale of a qualifying home sit outside the non-concessional cap

Need a hand with this?

Before 30 June is when this is worth discussing — particularly if you are expecting a capital gain, a bonus or a redundancy. Afterwards there is very little that can be done.

Book a consultation

Call 0410 250 400

Sources

This article is general information only and does not take your personal circumstances into account. Rates and thresholds are current at the date of publication. Speak to us before acting on anything you read here.