Superannuation Contributions After Retirement. What are the Rules?

So, you’re retired, but you still want to make contributions to super?

Okay, I see what’s going on here. You’ve done the calculations and can see the benefits of contributing to super, but you just want to double check the superannuation retirement rules. Am I right?

And believe you me, there are a few rules you need to be mindful of when contributing to super after retirement, so let’s take a look.

Superannuation Contributions After Retirement

Your eligibility to make contributions to superannuation after retirement is based on five factors:

  1. Your age;
  2. The type of contribution being made;
  3. Your account balance;
  4. When you retired; and
  5. Whether you will continue to work in any capacity.

There are also other types of contributions that can be made to super designed specifically for people who are already retired.

Related article: Superannuation Advice

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Super Contributions Under Age 67 and Retired

While you are under age 67, you are free to make either concessional or non-concessional contributions to super, regardless of your employment status.

Also, if you are over age 65, you are eligible to make the downsizer contribution.

Super Contributions Aged Between 67 to 69 and Retired

If you are aged 67 or more, but below age 70, you are only able to receive mandated employer contributions or make downsizer contributions.

However:

  • if you are retired, but have worked at least 40 hours over any consecutive 30-day period in the current financial year (known as the work test); or
  • have a total super balance below $300,000 and met the work test in the previous financial year, (known as the work-test exemption – which can only be applied in one financial year);

then you are eligible to make any type of super contribution.

Related Article:  Super Contributions Over 65

Super Contributions Aged Between 70 to 74 and Retired

Being aged between 70 and 74 means you can only receive mandated employer contributions and can only make downsizer contributions.

However, if you meet the work test or work-test exemption, you can also make personal concessional and non-concessional contributions up until 28 days after the end of the month in which you turn age 75.

Super Contributions Over Age 75

Being over age 75 means you can only receive mandated employer contributions and can only make downsizer contributions.

How Much Can A Retiree Put Into Super?

You always need to be mindful of superannuation contribution caps, as well as the limitations on non-concessional contributions if your total super balance exceeds or is near the transfer balance cap.

As a retiree, you are governed by the same contribution caps as the employed and self-employed.

The general non-concessional contribution cap is $110,000 per financial year and the general concessional contribution cap is $27,500 per financial year.

If you are under age 67, you may be able to utilise the non-concessional contribution bring-forward rule. In regards to concessional contributions, you may be eligible to utilise any carry-forward unused concessional contributions while under age 75.

If your total superannuation balance exceeds the transfer balance cap of $1.7 million, you are unable to make any non-concessional contributions.

More details about the types of contributions that can be made to superannuation and how much you can contribute can be found here.

Remember, making contributions to super can be a great tax-effective retirement planning strategy, but before making any contributions to super, you should keep in mind that any amount contributed to super can only be accessed again once you have met a superannuation condition of release, such as retirement or reaching age 65.

Hi, I hope you enjoyed reading this article.

If you want my team and I to help with your retirement planning, click here.

If you prefer a DIY approach, then check out the SuperGuy HUB.

Thanks for stopping by - Chris

14 Comments

  1. Michael B Warren

    Hi,

    I am 65 and retired in February this year. I withdrew some funds from my super when I retired. I now wish to withdraw some funds from my super, topping up my cash and then recontribute $25000 concessionally into my fund to offset earnings in the first 6 months of the year.

    Can I do this?

    Regards

    Reply
    • Chris Strano

      Hi Michael,
      Being over age 65 means you have full unrestricted access to your super. Being over age 60 means you can generally withdraw funds from super tax free. Being under age 67 means there is no age restriction on you making concessional contributions to super. I can’t see an issue. Just be mindful of any concessional contributions (e.g. salary sacrifice, employer SG contributions, personal concessional contributions) already made in the current financial year. You may also want to consider any carry-forward concessional concessional contribution caps from previous years if your balance was under $500k on 30 June 2020.
      Related Posts
      Concessional Contribution Cap
      Unused Concessional Contributions

      Reply
  2. Vinay Gupta

    Hi,

    I have a question. I am 62y and retired from work in australia, but likely to work in NZ part time. I have an SMSF and want to make non-concessional contributions from my after tax savings. What are the rules for bring forward where one can make a lumpsum contribution of I think 150K ? Am I eligible for this, having previously made a contribution under this rule in 2017. And if I can, how do I go about it ?

    Kind regards,
    Vinay

    Reply
  3. vinod

    Hi, I an 72 years old and draws pension from CSS. I am also working part time and contributing the maximum allowable amount to the the super. As my superannuation balance also exceeds 1.7m. I was wondering if I can open another super pension fund by transferring funds from my savings rather than leaving the funds in the bank accounts.

    Reply
    • Chris Strano

      Hi Vinod,
      Non-concessional contributions are unable to be made to super if your total super balance exceeds $1.7M. Your total super balance includes all of your combined super accounts. Therefore, opening another super account will not circumvent these rules. There are other options available to invest in your own name, rather than leaving funds in bank accounts. Please feel free to contact our financial planning firm, Toro Wealth, if you would like to discuss this further.
      Regards,
      Chris

      Reply
  4. Jane

    Hi, I am 71 years old and retired last financial year. I have $100,000 in super and have inherited $145,000 recently. Can I add it to my super? Is this the most cost effective option for me? Thanks

    Reply
    • Chris Strano

      Hi Jane,
      Thank you for your question. You generally need to meet the superannuation work test (or work test exemption) in order to make contributions to super over the age of 67. Determining whether contributions should be made to super is based on other factors, such as your objectives, other sources of income and other assets outside of super. You might consider obtaining personal advice in relation to this. If you do not have a financial planner, feel free to arrange a complimentary consultation with us at Toro Wealth, by booking in an appointment time here https://calendly.com/torowealth/15mincall
      Regards,
      Chris

      Reply
  5. Jay Narsee

    As a retiree , over 70, earning income from the country that I immgrated from as well as earning income here in Australia how much can I contribute to the Superannuation fund

    Reply
    • Chris Strano

      Hi Jay,
      When over age 67, you will need to meet the work test or work test exemption to make contributions to super (as defined in the article above). However, no contributions can be made to super 28 days after the end of the month in which you turn age 75.

      Reply
  6. Gil Tyack

    My wife (64) and I (69) are both retired. We last made non-concessional contributions to my wife’s super that is in accumulation phase in December 2018 using the bring forward rule. Three financial years have now passed and it is our intention to make further non-concessional contributions in the current financial year to her super account possibly using the bring forward rule again ($110k plus). Is my rationale correct to follow this course of action?

    Reply
    • Chris Strano

      Hi Gil,
      Utilising the bring-forward rule in the 2019 financial year, means that you brought-forward the 2020FY and 2021FY cap. Therefore, the bring-forward rule is available again, given we are in the 2022FY. The bring-forward rule can only be utilised by individuals under age 67. While these are the rules, I am unable to comment on whether it is suitable or not for you to make such contributions.
      Related Post
      Non-Concessional Contribution Cap
      Hope this helps,
      Regards,
      Chris

      Reply
  7. Valerie Squire

    I am 68 y.o. I have a super balance of around $360,000 After a property sale I have $200,000 in a bank account that I would like to combine. Currently, I do not receive a pension and currently earn $30,000 before deductions from my bed and breakfast which is run from home. The time it takes running this, I feel could satisfy the work requirement.

    I am also considering changing from Retail to an Industry Superfund judging by performance. If it is possible to combine these funds, is it preferable to do this before joining another fund?

    Reply
    • Chris Strano

      Hi Valerie,
      Assuming you have met the work conditions, a person over age 67 is limited to super non-concessional contributions of $110,000 per financial year, provided you have not utilised the bring-forward rule in previous years. Have you considered applying for the Age Pension? you might just sneak in…
      I would be cautious of changing super funds based on performance. Each super fund has an array of investment options available to you. Investment performance is not determined by the fund you are with, but rather the investments chosen within the fund. Changing super fund can result in many other issues. Watch this YouTube video I made on the risks of switching funds https://www.youtube.com/watch?v=EGYS3OjrAmo
      Either way, I think personal advice could be very valuable to you. If you do not have an adviser, feel free to get in touch with us here for a chat to see if we can assist https://www.torowealth.com.au/
      Regards,
      Chris

      Reply

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