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New Queensland Government super arrangements: tips on tax and caps

Superannuation

04 September 2023 5 min read

Queensland Government super contribution arrangements from 1 July 2023 might mean you receive more super, which makes it worth checking on your contribution caps and any potential tax impacts.

If you’re eligible for the super contribution changes for Queensland Government employees, you’ll be paid super on more types of earnings and you may also receive a one-off top-up contribution.

The changes mean you may receive more in super contributions. So, it’s important you’re aware of super contribution caps. Going over the cap might mean paying more tax.

What changed from 1 July 2023

If you’re a Queensland Government employee covered by the changes, you may receive more super from 1 July 2023 for three reasons:

You will now receive an employer contribution of 12.75% (18% for police or 14.25% for fire service officers, which includes firefighters, fire communications staff and auxiliary firefighters) on ordinary time earnings (OTE). This rate is higher than the Super Guarantee (SG) rate of 11% and employees are free to make their own personal super contribution if they choose.

Super is paid on more types of earnings than before. All employer contributions are calculated on employee ordinary time earnings, which includes when the employee is on paid leave as well as shift and weekend penalties.

If you’re eligible, you may have received a one-off super top-up this year. The top-up takes employer contributions for 2022-23 to 12.75% (or 18% for police and 14.25% for fire service officers) if you hadn’t received that much already.

Why more super can impact tax

You may receive more super because of the changes. Contributing too much to super can mean you’ll pay more tax.

What are contribution caps?

There are limits on the amount of money you can contribute to your super. These limits are called contribution caps.

There are two types of caps:

Concessional (before-tax) contribution cap

Before-tax contributions include employer contributions, including salary sacrifice, and personal contributions for which a tax deduction has been claimed.

The cap on before-tax contributions is up to $27,500 in a financial year.

The tax to pay on these contributions is generally 15%. (It’s more if your income plus your before-tax contributions is more than $250,000.) If you have a total super balance of less than $500,000 on 30 June of the previous financial year, you may be entitled to “carry-forward” unused concessional contributions. This means that you can contribute more than the general concessional contributions cap, and make additional concessional contributions for any unused amounts.

Amounts carried forward that have not been used after five years will expire.

If you go over the cap, the amount you go over will be included in your income and taxed at your normal tax rates (which can be up to 45% plus 2% medicate levy depending on your income). The ATO will give you a 15% tax offset, which means the tax on the amount you go over the cap is reduced by 15%.
Non-concessional (after-tax) contribution cap

After-tax contributions are money you’ve already paid tax on that you then contribute to your super. The cap on after-tax contributions is $110,000 in a financial year as long as you do not have a total super balance greater than the general transfer balance cap of $1.9 million at 30 June of the previous financial year.

There’s no more tax to pay on these contributions. You’ve already paid tax on this money.

If you go over either cap the ATO will notify you of your options.

More information about going over your different contribution caps can be found here.

How to keep on top of contributions

Going over the caps can mean paying more tax. QSuper account holders can track contributions into their QSuper account in Member Online or on our app. Contributions made to other super funds will count towards the cap and can be tracked in myGov.