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Valuable super contribution changes are now law

Several valuable superannuation changes that affect an individual’s ability to contribute to super, particularly those age 67 to 74, are now law with effect from 1 July 2022.

The Treasury Laws Amendment (Enhancing Superannuation Outcomes for Australians and Helping Australian Businesses Invest) Bill 2021 received Royal Assent on 22 February 2022.

In this article I review the major changes that will assist many individuals grow their super from 1 July 2022.

Remove the Super Guarantee $450 income threshold

Since the introduction of the Super Guarantee (SG) system in 1992, employers have not been required to pay SG contributions for employees who earn less than $450 in a calendar month.

From 1 July 2022, the $450 income threshold will be removed, and employers will be required to pay SG contributions for all employees regardless of income.

However, there are no changes to the SG exemptions for minors. Contributions are not required for employees under age 18 who work less than 30 hours per week, regardless of their monthly income.

This will see an increase in the super savings of many individuals particularly those who have multiple part time jobs.

Employers will need to ensure that their payroll systems are updated to deal with the changes from the first SG payment cycle after 1 July 2022.

Extension of the non-concessional contribution bring forward rule

From 1 July 2022, access to the non-concessional contribution bring forward rule will extend to individuals who are age 74 or less on 1 July of a financial year. Currently the bring forward arrangements are only available to individuals age 67 or less.

All the other eligibility requirements for accessing the bring forward arrangements remain unchanged. Individuals must have a total superannuation balance at the previous 30 June of under $1.48 million to be eligible for a three-year bring forward period and contribute up to $330,000 of non-concessional contributions. Individuals must have a total superannuation balance at the previous 30 June between $1.48 million and $1.59 million to be eligible for a two-year bring forward period and contribute up to $220,000 of non-concessional contributions. They must also not currently be in a bring forward period.

Individuals with a total superannuation balance at the previous 30 June between $1.59 million and $1.7 million cannot use the bring forward rule but can contribute up to $110,000.

Non-concessional contributions cannot be made if the total super balance at the previous 30 June is at least $1.7 million. These thresholds are subject to indexation.

This measure may provide the opportunity for individuals to bolster their superannuation savings from money currently held in less tax effective environments outside of super.

It may also provide individuals with the opportunity to improve their estate plans if they expect their superannuation death benefit will be paid to adult children. By withdrawing monies from super and recontributing non-concessional contributions individuals may increase the tax-free component of their account. This may result in lower tax on death benefits.

Individuals should seek professional advice in implementing these types of strategies.

Changes to work test requirement

As part of the contribution changes, the Government announced that superannuation rules will no longer require an individual age 67 to 74 to meet a work test to be able to contribute to super. There will continue to be no work test requirement to receive SG or Award contributions. These measures require changes to superannuation regulations, which do not require Parliamentary approval and we expect them to be made shortly.

Individuals age 67 to 74 will be able to make non-concessional contributions or salary sacrifice contributions without meeting the work test.

Importantly however, the tax laws have been updated to make meeting the work test a continued condition for eligibility to make a personal deductible contribution. There is no change to the work test definition, individuals must work 40 hours in 30 consecutive days in the financial year in which the contribution is made.

This means that individuals age 67 to 74 who do not meet the work test will not be able to make a personal deductible contribution to offset a realised capital gain.

Increases for release under the First Home Super Saver scheme

The limit on voluntary contributions made over multiple financial years that are eligible to be released under the First Home Super Saver (FHSS) scheme will be increased from $30,000 to $50,000 (plus associated earnings).

For more information on the changes to the FHSS scheme see our recent article at Firstlinks - FHSS scheme.

Reduced minimum age for downsizer contributions

From 1 July 2022, the minimum age at which an individual is eligible to make a downsizer contribution is reduced from 65 to 60.

This will provide additional opportunities to access the downsizer contribution concession for those who sell a home after age 60.

All the other downsizer eligibility criteria remain unchanged including the requirement for the contribution to be made within 90 days of receipt of the sale proceeds. This means that there may be an opportunity for individuals who are between age 60 and 65 who sell their home between mid-April and 30 June 2022 to make a downsizer contribution in 2022-23.

For more information on the eligibility criteria for making a downsizer contribution see our previous article at Firstlinks - downsizer contributions.

Exempt current pension income

In addition to the changes to contribution rules, there is a change in the law for how SMSFs can calculate exempt current pension income (ECPI). From the 2021-22 financial year, SMSF trustees will be able to choose their preferred method of calculating ECPI where not all of the interests in the fund are in retirement pension accounts for part, but not all of the year. This includes funds that have a transition to retirement income stream or an accumulation account.

Trustees will be able to choose to obtain an actuarial certificate to calculate the ECPI for the whole year, which is often a simple solution. Alternatively, they may be able to use the actuarial certificate for only the parts of the year where the fund held both accumulation and retirement pension accounts and use the actual income for the parts of the year that the fund held 100% in retirement pension accounts.

Depending upon the timing of transactions during the year, either methodology may provide a higher ECPI amount.

For more information on the best option for an SMSF, it is recommended that trustees consult the fund’s actuary, financial adviser or accountant.


These recently legislated changes provide opportunities for individuals to start planning their eligibility and capacity to increase their superannuation retirement savings from 1 July 2022, until age 75.


Julie Steed is Senior Technical Services Manager a Australian Executor Trustees. This article is in the nature of general information and does not consider the circumstances of any individual.


March 19, 2022

Thank you Julie. Understanding Exempt current pension income is somewhat challenging for me. Would you be able to give an example of how it works just highlight the principle ?

Julie Steed
March 23, 2022

Hi Albert,
As a general rule, investment returns earned on assets that support accumulation accounts (and transition to retirement pensions) are taxed at 15%. However, investment returns earned on assets that support retirement phase pensions are tax free. This tax-free income is called exempt current pension income (ECPI).
If a fund is 100% in accumulation phase, all of the investment returns are taxable. If a fund has 100% in retirement phase pensions all of the investment returns are exempt/tax-free.
Where a fund has a mixture of accumulation and retirement phase pension accounts the fund's actuary generally is required to calculate the ECPI percentage. This is often called the proportionate method. The formula is the average of the assets supporting pension liabilities during the period divided by the average assets supporting the total superannuation liabilities during the period.
If the actuary determines the ECPI percentage to be 75%, then 75% of the investment returns are exempt/tax-free and 25% will be taxed at 15%.

Helen Drew
March 18, 2022

I am 78 and still working part-time, earning $150 per week. Will I be eligible for the contribution, or will the fact that I'm over 75 mean the super need not be contributed for me? (Bit silly, I know, given my age!)

Julie Steed
March 23, 2022

Hi Helen,
There is no maximum age for super guarantee payments so you will receive super guarantee on all income below $450 from 1 July 2022. Prior to 1 July 2013 only employees under age 70 were eligible.
The $450 limit is per calendar month. Any months that you have earned $450, super guarantee should be payable.
Also, from 1 July 2022, the super guarantee rate increases to 10.5%.
(And it's never silly to care about super!)

Julie Steed
March 14, 2022

Hi Pete, Yes, from 1 July 2022 someone aged between 67 and 74 who is not working will be able to make non-concessional (after tax) contributions to a super account. However, to be able to claim a tax deduction on passive income, a person will need to meet the work test of working 40 hours in 30 consecutive days during the financial year. Regards Julie

March 10, 2022

Thanks Julie. For clarification, does that mean someone aged between 67 and 74 who has retired, ie not working but has passive income, can open a super account and contribute until age 74?


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What super changes should you know from 1 July?

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