Super contributions in Australia come in two main types: concessional, which are paid from your pre-tax money and taxed at 15 per cent inside the fund, and non-concessional, which are paid from money you have already been taxed on and are not taxed again going in. Each type has its own annual cap, and going over it has tax consequences, so the trick is knowing which bucket your money lands in before you tip it in.
Get that right and super is one of the more reliable ways to build wealth in this country. Get it wrong and you can hand the tax office a bill you did not see coming. Let us walk through the two types, the caps, and the extra boosts lower earners and couples can pick up.
Concessional contributions: the pre-tax bucket
Concessional contributions are the ones that go into super before income tax is taken out. They include three things you might recognise:
- Employer super guarantee. The compulsory percentage of your wage your boss must pay into your fund.
- Salary sacrifice. Extra amounts you arrange to have redirected from your pre-tax pay, which is worth understanding properly before you set it up. Our guide to salary sacrifice into super covers the mechanics.
- Personal deductible contributions. Money you pay in from your own pocket and then claim as a tax deduction.
Because this money has not been taxed at your marginal rate yet, the fund takes 15 per cent on the way in. For most people earning a middle income, that 15 per cent is a good deal less than the rate they would otherwise pay, which is the whole point. Very high earners can face an additional charge on top, so it is not a flat 15 per cent for everyone.
Concessional contributions are capped. As at the figures last checked June 2026, the annual concessional cap sits at around $30,000, though you should treat that as a guide rather than gospel and confirm the current number with the ATO, because these thresholds are indexed and change over time.
Carry-forward: using up old, unused cap
Here is a feature people often miss. If you did not use your full concessional cap in recent years, you may be able to carry forward the unused portion and make a larger contribution now. There are conditions, including a limit on your total super balance, and the unused amounts only stretch back a set number of years before they expire.
This matters most for people with patchy incomes, anyone returning from a career break, or those who suddenly have spare cash, say after selling an asset, and want to soak up several years of unused cap in one hit. It is one of the more useful and underused rules in the system, so it is worth checking your available carry-forward amount in your myGov account linked to the ATO.
Non-concessional contributions: the after-tax bucket
Non-concessional contributions are made from money you have already paid income tax on, so the fund does not tax them again on the way in. Think of a lump sum from your savings, an inheritance, or proceeds from selling something.
These have their own separate cap, which is higher than the concessional cap. Some people can also use a “bring-forward” arrangement to contribute several years’ worth of the non-concessional cap at once, subject to age and total super balance rules. As with everything here, the exact cap and eligibility depend on current thresholds, so confirm them with the ATO before you act.
Know which bucket your money lands in before you tip it in, because the cap and the tax treatment follow the bucket, not your good intentions.
Free money: co-contributions and the spouse offset
Two smaller mechanisms reward modest contributions, and they are easy to overlook.
The government co-contribution is aimed at lower and middle income earners. If you make a personal after-tax contribution and your income falls under the relevant threshold, the government may chip in a matching amount up to a capped figure. You generally do not need to apply: the ATO works it out from your tax return and your fund’s reporting.
The spouse contribution offset can apply where you contribute to the super of a lower-earning or non-earning partner. Depending on their income, you may be able to claim a tax offset for doing so. It is a quiet way to even up balances between partners while picking up a small tax benefit.
Neither is life-changing on its own, but for the right person they are close to free money, and they stack with the ordinary benefits of contributing.
What happens if you go over a cap
Exceeding a cap is not the end of the world, but it does create paperwork and, usually, a tax cost. Broadly, excess concessional contributions get added back to your assessable income and taxed at your marginal rate, with an offset for the 15 per cent already paid by the fund. Excess non-concessional contributions are handled differently again, with options to withdraw the excess plus associated earnings.
The practical takeaway is to keep a running tally across all your funds, because the caps apply to you as a person, not to each account separately. If you have changed jobs and picked up a second fund along the way, both lots of employer contributions count toward the same concessional cap.
Here is a quick side-by-side of the two main types.
| Feature | Concessional (pre-tax) | Non-concessional (after-tax) |
|---|---|---|
| Source | Employer SG, salary sacrifice, personal deductible | Money already taxed (savings, inheritance) |
| Taxed going into the fund | Yes, generally 15 per cent | No |
| Annual cap | Lower (around $30,000, last checked June 2026) | Higher, separate cap |
| Catch-up option | Carry-forward of unused cap | Bring-forward of future cap |
| Confirm current figures | ATO | ATO |
If you are weighing how much to put in and when, it helps to set the contributions question against a broader target. Our piece on how much super you should have by age gives a sense of whether you are ahead or behind, and from there you can plan contributions around the caps without tripping over them.
A quick word on advice
This is general information, not personal financial, tax or legal advice. Your income, age, total super balance and goals all change what is sensible for you, and the caps, rates and thresholds quoted here are indexed and move over time. The figures in this article were last checked June 2026. Before you act, confirm the current numbers and your own eligibility with the ATO or a licensed adviser, and check the details with your own fund.
The bottom line
Super contributions are simpler than they look once you sort them into two buckets. Concessional money goes in pre-tax and is taxed at around 15 per cent inside the fund, up to a cap of roughly $30,000 a year, with carry-forward if you have unused room. Non-concessional money goes in after tax, untaxed on the way in, under its own higher cap. Lower earners can pick up a co-contribution, couples can use the spouse offset, and everyone should keep an eye on the caps, because the tax office certainly will. Confirm the current thresholds with the ATO, and your super will quietly do its job.