{"id":7821,"date":"2023-01-23T12:00:05","date_gmt":"2023-01-23T01:30:05","guid":{"rendered":"https:\/\/adelaideprivatewealth.com.au\/spouse-super-contributions-the-benefits\/"},"modified":"2023-01-23T12:00:05","modified_gmt":"2023-01-23T01:30:05","slug":"spouse-super-contributions-the-benefits","status":"publish","type":"post","link":"https:\/\/adelaideprivatewealth.com.au\/spouse-super-contributions-the-benefits\/","title":{"rendered":"Spouse super contributions: the benefits"},"content":{"rendered":"
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If your partner either earns less than you or is not currently working, they may be adding little or nothing to their super. The good news? If you\u2019re married or in a permanent de facto relationship, you may be able to help grow their super in a way that can benefit both of you.<\/p>\n

If you make an after-tax super contribution into your spouse\u2019s super, you may be eligible for a tax offset of up to $540 and help reduce your tax payable. Here\u2019s how spouse contributions work.<\/p>\n

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Who can make and receive spouse contributions?<\/h3>\n

You must be married or in a de factor relationship with your partner to make super contributions on their behalf. You must also both be Australian residents.<\/p>\n

To be eligible for the full tax offset amount, your partner must have income of $37,000 p.a.1<\/sup>\u00a0or less, and you must contribute $3,000 or more into your spouse\u2019s super. A lower tax offset may be available if you contribute less than $3,000 or your spouse earns between $37,000 and $40,000 p.a.<\/p>\n

Case study<\/h3>\n

Stephen and Tracy are married and have two young children. Stephen works full-time and earns $100,000 p.a. Tracy has cut back to working two days a week and earns $32,000 p.a.<\/p>\n

They want to make sure Tracy keeps building her super while she is working part-time. Stephen contributes $3,000 into Tracy\u2019s super account. This entitles him to a tax offset of $540, which will reduce his income tax when he completes his tax return for the financial year.<\/p>\n

Important things to consider<\/h3>\n

Spouse contributions count towards the receiving spouse\u2019s\u00a0non-concessional contributions cap<\/a>\u00a0(NCC cap) and penalties may apply if the cap is exceeded. The rules that relate to the NCC cap are complex. You can find out more about them on\u00a0our website<\/a>\u00a0and on the Australian Taxation Office (ATO<\/a>) website.<\/p>\n

To receive a spouse contribution in 2022\/23, your spouse\u2019s\u00a0total super balance<\/a>\u00a0must be under $1.7 million on 30 June 2022.\u00a0They must also be\u00a0eligible to receive<\/a>\u00a0spouse contributions. It\u2019s important to remember that the offset won\u2019t apply if your spouse exceeds the non-concessional contributions cap for the relevant year, or if your spouse has a total super balance over the general transfer balance cap of $1.7 million.<\/p>\n

Your spouse must be eligible to have the contribution made to superannuation which may include age test requirements \u2013 see the\u00a0ATO<\/a>\u00a0website for more information.<\/p>\n

More ways to grow your super<\/h3>\n

Discover more ways you and your partner can add to your super, such as other contribution types. Or find out ways to claim a benefit, such as a tax deduction or the government co-contribution.<\/p>\n

Did you know?<\/h3>\n

Another option for boosting your spouse\u2019s super balance is to split eligible concessional (before-tax) contributions from your account to your spouse\u2019s. This is referred to as\u00a0contribution splitting<\/a>. These generally include the Superannuation Guarantee, salary sacrifice contributions and personal contributions for which you claim a tax deduction.<\/p>\n

We\u2019re here to help<\/h3>\n

Before making a contribution to your spouse\u2019s super, you should consider your and your partner\u2019s financial circumstances, contribution caps, and tax issues. Salary sacrifice may affect some government benefits and employee benefits. You should consider getting financial advice before deciding if spouse contribution arrangements are right for you and your partner.<\/p>\n

A financial adviser can help you identify ways to grow your super. So, start the conversation to see how a financial adviser can help you. If you don\u2019t have one, give us a call and we can help you find one near you.<\/p>\n

Ready to make a spouse contribution?<\/h3>\n

Adding to your and spouse\u2019s super now can mean more at retirement. Consider the Concessional Contribution and Non-Concessional Contribution caps before contributing so that you don\u2019t end up paying more tax than you need. Also, make sure you are eligible to contribute before making a contribution.<\/p>\n