I turned 49 this year and made a concessional contribution of $42,000 to my super fund. Why was my super fund taxed at a marginal tax rate?
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Answer by Neha Sharma, Hillsdale 2036 NSW
- Super funds are taxed at a concessional rate of 15% making self-contributions an attractive option for some people.
- However there are limits (also called caps) on how much a person may contribute each financial year.
- The limits are set yearly and for the 2014-2015 financial year the concessional contributions limit is $30,000 for persons under 50 years of age and $35,000 for persons 50 years and older.
- Any amount over the limit will be added to the person’s assessable income and taxed at the marginal tax rate.
- Non-concessional contributions have a higher limit of $180,000 for the 2014 -2015 financial year. Any contribution above the limit will be taxed at 49%.
- You should speak to a financial adviser or a tax agent if you are unsure about the tax implications of contributions for your super.