Many couples find a big difference in their superannuation balances as they approach retirement. Addressing this imbalance strategically could help you reduce tax, boost retirement savings, and even maximise Age Pension benefits.

Here’s how Spouse Contribution Splitting could work for you:

 

1. Why Spouse Contribution Splitting Matters

Your Total Super Balance (TSB) impacts your ability to maximise contributions and access key tax strategies.

The rules vary based on your TSB:

• Below $1.9 million – Eligible to make Non-Concessional Contributions.
• Below $500,000 – Can use carry-forward provisions for Concessional Contributions.
• Below $300,000 (Ages 67–74) – Can still claim tax deductions on personal contributions.

 

Spouse contribution splitting can also help increase Age Pension eligibility by shifting more super to the younger spouse, as superannuation isn’t counted in the asset test until the individual reaches pension age.

 

2. How Spouse Contribution Splitting Works

• Transfer up to 85% of your concessional (before-tax) contributions from the previous financial year to your spouse’s super account.
• Eligible contributions include employer super guarantee, salary sacrifice, and personal tax-deductible contributions.
• The maximum split is generally $25,500 (85% of the $30,000 concessional cap).
• The receiving spouse must be under 65, or 60–64 and not retired.
• The split is a rollover and does not impact the receiving spouse’s contribution caps.

 

3. Timing & Next Steps

• Apply for contribution splitting after the end of the financial year in which contributions were made.
• Check with your super fund, as not all funds offer this option.
• If rolling over or withdrawing your entire super balance before year-end, apply the contribution splitting within the same financial year.

 

Could Spouse Contribution Splitting benefit you?

At SCM Financial Group, we have been helping couples optimise their superannuation to achieve financial freedom in retirement. Get in touch with us today to discover how this strategy can help boost your savings for retirement.

 

Ian Bennet – Partner and Principal, SCM Accounting & Advisory