To help those people on lower incomes save more for their retirement, the Australian Federal Government established the Superannuation Co-contribution Scheme. Depending on how much you earn each year, the government can chip in to help boost your super every time you make a voluntary after-tax contribution of your own.
How the super co-contribution works in 2020/21
If you earn less than $54,837 per year, the government can contribute up to $500 to your super account in a year.
Depending on your income, the government will pay in up to 50 cents for every one dollar you contribute yourself from your after-tax income.
Who is eligible?
You need to satisfy certain basic criteria before you are eligible for a government co-contribution. In 2020/21 you must:
- Be an Australian citizen, a permanent Australian resident or a New Zealand citizen working in Australia
- Be less than 71 years of age
- Have made at least one voluntary, after-tax contribution to your super fund
- Earn less than $54,837 in that financial year
- Be in full or part-time employment and/or run your own business
- Include all the details of your after-tax contributions on your Tax Return
- Have a super balance of less than $1.6 million on 30 June of the previous financial year
- Not have exceeded the before-tax contributions cap in the current financial year
How to apply
When you’re completing your annual tax return, simply fill out the details of your superannuation fund and your own contributions where requested. And, as long as you meet all the criteria, the Australian Taxation Office will work out the level of government co-contribution and automatically pay this amount into your super.
For help, or more information, contact your super fund.