Interaction between the

The interaction between the “bring forward” of contributions and the excess non-concessional contribution threshold is illustrated in an example which has been taken from the factsheet issued as part of the Press Release for the super changes.

Eamon has a total superannuation balance of $1.45m on 30 June 2018.  He can make non-concessional contributions in 2018/19 as the $1.6m threshold has not been reached.  He could make a $100,000 non-concessional contribution.

As Eamon is under age 65, he is permitted to make use of the “bring forward”.  Normally, the maximum bring forward amount would be $300,000 (as each financial year of the “bring forward period” occurs after 30 June 2016).  However, Eamon is restricted to only $200,000.

The restriction arises because the first $100,000 will be treated as increasing his superannuation balance to $1.55m – which is still under the $1.6m non-concessional contributions threshold.

The second $100,000 can be made as Eamon’s superannuation balance (notionally adjusted for the first $100,000) is still under $1.6m threshold.  
The third $100,000 cannot be made as Eamon’s superannuation balance (notionally adjusted for the first and second contributions) exceeds the $1.6m threshold.

Comments:  It is easy to state that the taxpayer must have a superannuation balance of less than $1.6m, however it is a very different thing to actually determine whether this will be the case.  The superannuation balance is a global balance of all the taxpayers’ superannuation interests including those interests which are in pension phase.