Government Super match for low earners.
Government co-contribution
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Free money the government quietly hands to low earners
The super co-contribution is one of the most generous deals in Australian personal finance, and one of the most under-claimed. If you are a lower-income earner and you put your own after-tax money into super, the government chips in 50 cents for every dollar you contribute, up to a maximum of $500 a year. There is no application form and no separate claim: the ATO works it out automatically from your tax return and your fund's reporting, then pays it straight into your super. This tool shows how much the government would add based on your total income and the size of your personal contribution.
Where the income limits bite
The catch is income. You get the full benefit only if your total income is at or below the lower threshold of $43,445. Above that, the maximum co-contribution tapers away gradually until it disappears completely at the upper threshold of $58,445. The taper works on the $500 maximum, reducing it in proportion to how far you are into the band, so someone earning halfway between the thresholds can still collect roughly half the top-up. Earn above $58,445 and there is no co-contribution at all, no matter how much you contribute. To be eligible you also need to be under 71, have at least 10 percent of your income coming from employment or a business, and make the contribution as a non-concessional, after-tax payment.
A $35,000 earner putting in $1,000
Imagine you earn $35,000 and contribute $1,000 of your own after-tax money to super. Because your income sits comfortably below the $43,445 lower threshold, you qualify for the full rate. The tool returns a co-contribution of $500.
Notice that contributing more than $1,000 would not increase the co-contribution, because $500 is the ceiling and $1,000 of your money already reaches it. That is the sweet spot: a $1,000 personal contribution is exactly what unlocks the full $500 for a full-rate earner, an instant 50 percent return before the money has even been invested.
Who should be paying close attention
This scheme is built for a specific group, and if you fall into it the co-contribution is close to a no-brainer. Part-time workers, people returning from a career break, students with a casual job, and lower-paid earners in their twenties are the natural candidates. There is a subtle planning angle too: total income for this test includes salary, business income, and reportable fringe benefits, and it is reduced by allowable business deductions, so a sole trader near the threshold can sometimes bring themselves into eligibility by claiming the deductions they are entitled to. A spouse who has stepped back from work to raise children, with some part-time income, is another classic fit, and the household can effectively earn a guaranteed $500 a year by funding a modest contribution.
The mistakes to avoid are easy ones. Do not salary sacrifice the money and expect a co-contribution: salary sacrifice is a concessional, pre-tax contribution, and only non-concessional after-tax contributions count for this top-up. Do not leave it to the last week of June and risk the payment not clearing your fund before 30 June, because it must be received in the financial year to count. And do not assume you missed out if your income was a little high; the partial co-contribution in the taper zone is still real money, and the tool will show you the reduced figure rather than zero.
Do I have to claim the co-contribution on my tax return?
No, and this trips people up in the other direction. You simply make the after-tax contribution and lodge your normal tax return; the ATO matches your return against the contribution your fund reports and pays the co-contribution automatically, usually after your return is processed. There is no box to tick. Just make sure your fund has your tax file number, or it cannot accept the contribution properly.
Can I get both the co-contribution and the spouse offset?
They are different schemes for different people. The co-contribution rewards your own after-tax contribution to your own super. The spouse contribution tax offset rewards a higher earner who contributes to a low-income partner's super. A couple can use both in the same year as long as each contribution meets its own rules, so it is worth checking whether your household qualifies for the pair.