Spouse Contributions to SMSFs

Spouse superannuation contributions are after-tax contributions made into a spouse’s SMSF account. The contributing partner may be eligible to claim a tax offset up to 18% of the contribution amount, capped at $3,000 per year, resulting in a maximum offset of $540. This incentive aims to support retirement savings for spouses with low or no income.

Eligibility Criteria

Eligibility Criteria

To qualify for spouse contributions and associated tax offsets, the recipient spouse must be legally married or in a genuine de facto relationship, including same-sex partners. Both individuals should be Australian residents.

Couples permanently living separately apart are ineligible under superannuation laws for this offset. The spouse must be under the preservation age, or aged 65 to 74 while meeting the work test or qualifying for a work test exemption.

The spouse’s income is assessed by combining assessable income (excluding First Home Super Saver released amounts), reportable fringe benefits, and reportable employer super contributions. The tax offset applies fully if total income is $37,000 or less, phases out between $37,000 and $40,000, and is unavailable beyond $40,000.

Additionally, the spouse must have a total superannuation balance below the general transfer balance cap of $1.9 million for the 2024–25 financial year. Contributions made when the balance exceeds this cap do not qualify for the offset.

Contribution and Tax Treatment

Spouse contributions count as non-concessional contributions for the receiving spouse and are not taxed upon entry to their super fund. The contributor cannot claim these payments as a tax deduction but may benefit from the tax offset discussed. Exceeding non-concessional contribution caps may lead to penalties and additional reporting.

Calculating the Tax Offset

The tax offset is calculated as 18% of the lesser of $3,000 or the actual spouse contributions made. If the spouse’s income exceeds $37,000 but is below $40,000, the offset is gradually reduced. No offset is available if income reaches or exceeds $40,000.

Spouse Contributions

Spouse contributions to SMSFs provide a strategic way to help build retirement savings for lower-income or non-working partners, paired with a meaningful tax incentive for the contributing spouse. Understanding eligibility rules, income and balance limits, and offset calculations is vital for making informed decisions and maximising benefits within the Australian superannuation system.

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(GENERAL INFORMATION ONLY)

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