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Home Contribution splitting

Contribution splitting

Splitting your contribution with your spouse could help you both achieve financial security in retirement.

What is contribution splitting?

Splitting your contribution with your spouse could help you both achieve financial security in retirement. Contribution splitting allows you to split your before – tax (concessional) contributions from your accumulation super account with your spouse. Your before-tax contributions include SG contributions from your employer, and amounts you have salary sacrificed into super. 

Benefits of contribution splitting

Contribution splitting could create a more tax effective retirement
Contribution splitting could benefit high income earning and pre-retirement couples where one member of the couple’s super account balance is expected to exceed $1.6 million. Balances are often skewed to one partner, who may end up paying more tax in retirement even if their spouse is well under the $1.6 million individual limit. Contribution splitting could help couples optimise the individual limits and increase the amount of money that can be held tax free at retirement.

Contribution splitting rules can keep parents on track for retirement
The super gap for a stay-at-home parent can be significant. Contribution splitting can allow both members of the couple to keep their account balances growing, and you don’t need to find any extra cash flow in the household to put this strategy in place.

Contribution splitting rules

Who can split contributions?
The spouse receiving the contributions must be under age 65 and not retired. The concessional contributions made in the previous financial year must still be held in the accumulation account (they cannot have been withdrawn, rolled over to another fund or converted into a pension).

How much can be split?
The maximum amount of taxed splittable contributions you can apply to split is the lesser of 85% of the concessional contributions for that financial year and the concessional contributions cap for that financial year.
Taxed splittable contributions are generally:
any contributions your employer made for you (your before-tax contributions), including any salary sacrifice contributions and any personal contributions you made for yourself that you have advised your super fund you will claim a tax deduction for. 

You can contact legalsuper for details of what contributions were made for you and whether they can be split. 

Note: You can only split contributions made in the previous year. For example, contributions made during the 2016/2017 can only be split during the 2017/2018 year, and contributions made during the 2017/2018 year can only be split during the 2018/2019 year.

What is the deadline?
Your application can be lodged in the financial year immediately after the one where the contributions were made. This means you have until 30 June 2019 to request a transfer of the 2017-2018 contributions.

If you plan to claim a tax deduction for super contributions, then that notice to claim a deduction must be lodged BEFORE the super splitting declaration. 

If you would like to know more, you can make an appointment to speak with one of our Client Service Managers.

Download the contribution splitting application form:

Contributions splitting application (92.28 KB)