Can you believe we are already in the new financial year? As we kick off FY2026/2027, many of us are setting new goals, reviewing our budgets, and looking at ways to build long-term financial security.
If superannuation isn't at the top of your review list, it definitely should be. On
1 July 2026, several major legislative changes took effect in Australia. Because of indexation (linked to inflation and average weekly earnings), the limits on how much you can contribute to your super have increased for the first time in two years.
This is incredibly positive news. It means you now have more opportunity to build your nest egg in a highly tax-effective environment.
Whether you are in the early stages of your career, building your family wealth, or preparing to transition into retirement, here are the three major super changes you need to know about right now—and how to make them work for you.
1. You can contribute more before-tax (Concessional Cap Increase)
What changed: The annual concessional contribution cap has officially increased from $30,000 to $32,500. Concessional contributions are made with pre-tax dollars (such as your employer’s Super Guarantee contributions and any salary sacrifice you arrange) or personal contributions for which you claim a tax deduction.
Why it matters to you: This increase gives you an extra $2,500 a year that you can channel into super at a concessional tax rate (generally just 15%, which is typically much lower than your marginal personal income tax rate).
The action step: If you salary sacrifice a set dollar amount, or if you make personal deductible contributions at the end of the year, it is time to calculate your new limit. Remember, your employer's compulsory 12% super payments count toward this $32,500 cap, so you'll want to calculate the "gap" you can fill yourself.
2. You can boost your after-tax savings (Non-Concessional Cap Increase)
What changed: The annual non-concessional (after-tax) contribution cap has risen from $120,000 to $130,000. These are contributions you make into your super using funds you have already paid personal income tax on (such as savings in your bank account).
Furthermore, if you are eligible to use the "bring-forward" rule, you can now contribute up to
$390,000 (three years’ worth of caps at once) in a single financial year, depending on your age and total super balance.
Why it matters to you: If you have cash sitting in a personal bank account, have recently sold an asset, or received an inheritance, keeping it in personal names means you are paying tax on the earnings at your marginal tax rate. Moving those funds into the protective, low-tax environment of super is one of the most powerful wealth-building strategies available.
The action step: If you have surplus cash or are expecting a lump sum this year, let's look at whether bringing forward your non-concessional caps is a smart move for your broader strategy.
3. More tax-free money in retirement (Transfer Balance Cap Increase)
What changed: The general Transfer Balance Cap (TBC)—the lifetime limit on how much super you can transfer from your accumulation account into a tax-free retirement pension phase—has officially increased from $1.9 million to
$2.1 million
Why it matters to you: This is fantastic news for anyone approaching retirement or already transitioning. It means retirees can now shield up to $2.1 million of their superannuation assets from investment earnings tax entirely once they commence an account-based pension. Any earnings made on funds within this pension phase are taxed at 0%.
The action step: If you are planning to retire soon or are considering starting an income stream, navigating the Transfer Balance Cap can be complex—especially if you already have an active pension. Taking the time to structure this correctly can save you thousands in unnecessary taxes.
Let’s make the most of the new rules together
Superannuation is one of the most powerful wealth-creation vehicles in Australia, but the rules are constantly moving. What worked for your strategy last year might need a quick tune-up to ensure you aren't leaving money on the table—or accidentally breaching the new limits.
If you want to review your current salary sacrifice arrangements, discuss a lump-sum contribution, or simply make sure your retirement plan is aligned with these new FY2026/2027 limits, I’m always here to help.
Feel free to reach out to me at
enquiries@efplanning.com.au or give me a call on
0403 761 305 to book a chat. Let's make sure your super is working as hard as you are.
Until next time,
Arlan
