News & Information

I’m retired, can I make superannuation contributions?

May 21, 2018

There’s a lot of legislation when it comes to superannuation and making superannuation contributions.  To make sure you don’t find yourself in hot water with the ATO, do your research and brush up on any changes effecting superannuation law, especially if you are planning on contributing to your fund.

People often wonder if they are eligible to contribute once they’ve retired.  Perhaps they’ve inherited a large sum of money, downsized their home or have some cash at bank they want to maximise.  They find themselves wondering if the contribution can only be made if they’re working, regardless of their age.

A non-concessional contribution is a superannuation contribution made from after-tax dollars.  For example, any cash you have sitting in your personal bank account is after-tax dollars, assuming you’ve paid all tax owed to the ATO.  So if you were to make a personal contribution with this money it may count as a non-concessional contribution.

Anyone under the age of 65 can make a non-concessional contribution whether they are employed, self-employed, looking for work or retired.

For people aged between 65 and 74, the contribution rules are different.  You’ll need to satisfy the work test in the financial year you intend on making the contribution.  To meet the work test you must have worked a minimum of 40 hours within a 30 consecutive day period.  If you don’t satisfy the work test and you make a non-concessional contribution you will face major tax implications.

If you’re 75 years of age or over and retired, you cannot make a non-concessional contribution. However, if you meet the work test non-concessional contributions are accepted provided the contribution is received on or before 28 days after the end of the month in which you turned 75.

While super contributions can play a role in retirement, it’s down to your age as to whether you may make a non-concessional contribution.  Retirement age differs for all of us so before you make a non-concessional contribution be sure to take into account your age and whether or not you need to satisfy the work test.

LifeTime Financial Group are specialist financial advisers (holding appropriate accreditations) who are ideally positioned to assist you.

Would you like to discuss your personal position further with one of our highly qualified financial planners? Why not call us today on 03 9596-7733.

There is no cost or obligation for our initial conversation/meeting.

Written by Adam Watts of LifeTime Financial Group. A leading privately owned Melbourne Financial Planning practice.