We note the work test rule (refer below for definition) for people aged 67 to 75 applies in respect to the deductibility requirements for personal/member contributions. That is, a member aged between 67 and 75 can make a deductible contribution, if they meet the work test, or, if they do not satisfy the work test in the relevant income year, they satisfy the work test exempt criteria.
The work test exempt criteria can apply if the following criteria is satisfied:
- The member was gainfully employed for at least 40 hours in any period of 30 consecutive days during the previous income year.
- The member’s total superannuation balance was less than $300,000 at the end of the previous income year.
- The member has not deducted a contribution in the previous income year or any earlier income years on the basis of satisfying these same criteria.
The change in rules also allows those under age 75 to utilise the bring forward rule in respect to non-concessional contributions. Members will only be able to access the bring forward arrangements for years in which they have cap space. For example, this means that if a member who was 74 with a total superannuation balance (TSB) of less than $1.48 million could contribute $330,000 prior to attaining 75 years under this change.
The bring-forward rule cap amounts in FY2022 are summarised below:
Total superannuation balance on prior 30 June | NCC for first FY | Bring forward period in years |
< $1.48m | $ 330,000 | 3 |
$1.48m to < $1.59m | $ 220,000 | 2 |
$1.59m to < $1.7m | $ 110,000 | 1 (no bring forward period) |
$1.7m or more | Nil | N/A |
** To meet the work test, you must be gainfully employed for at least 40 hours during a consecutive 30-day period in the financial year in which the contributions are made. This is an annual test. This means once you meet this test you can make contributions for the entire financial year.
