Division 293 Tax: A Guide for High Earners

0:00Division 293 tax hits, high earners in Australia, when their income plus before tax, super contributions top $250,000 in a financial year. It adds an extra 15% tax on some of those contributions. You get a notice from the Australian Taxation Office after your tax return processes, and you can pay it from your own pocket or request funds from. You're super fun. The tax amount is 15% of the smaller figure between your excess over the threshold or your actual concessional contributions. For example, with $270,000 in income and $30,000 in contributions, the excess is $50,000. So the tax comes to $4,500 on the full contributions. This mainly affects people with self-managed super funds or SMSFs who might be tempted to pay directly from their fund. Trustees need to follow strict steps to avoid trouble, as early payments count as illegal access to super and can lead to penalties or reversed transactions.

1:03To pay from an SMSF, first lodge an election form with the ATO, then wait for their official release authority before sending money. Your fund's agent or admin will confirm when it's safe to proceed, and you still have to meet the original due date, even with the 60-day election, window. Missing these steps risks fines and extra hassle, so always double check with the ATO process. Staying on top of this keeps your super compliant and penalty free. From your city, powered by AI, this is Adelaide News Today. I'm Corey with The Story.