Super Co-contribution -the basics that everyone knows
Most people know a bit about the super contribution –for low/medium income earners put in $1,000 and the government will match it.
But who has a spare $1,000? And I earn more than the $31,920 threshold (so I won’t get the full $1,000). How do I benefit?
You don’t have to put the full $1,000 in – you can put in $20+
Here is the key – you don’t have to put the full $1,000 into super to get the co-contribution.
(anything over $20 you can put in).
Medium earners – how to double your money
If your “super co-contribution income”(see below) is $53,000 – your maximum super entitlement is $297.40.
So if you put in $1,000 – you would get $297.40.
But to double your money– if you put in $300 you still get the $297.40.
You can still double your money if you put in less
If you put in $150 (or an amount less than the max entitlement) you get what you contributed ($150 in this case).
Low income earners -getting to $1,000
You don’t have to put it all in at once. If you start in July you could contribute $85/month to get to $1,000 a year ($85×12=$1,020). Or you could put in $200 when you have the spare cash.
* Super co-contribution “income”
This is a pretty good way to boost your super by getting money from the government
For a lot of people super contribution income will equal taxable income.
But you have to add rental property losses, fringe benefits amounts or have salary sacrificed into super as well – you need to add those amounts back (governments way to stop people who might not really be low-medium earners getting the contribution).
For example – if you had $33,000 taxable income but had $10,000 rental loss and $10,000 fringe benefit from work car and had salary sacrificed $10,000 super – once you add back those items you would be at $63,000 and not eligible for super co-contribution (based on 2011 threshold of $61,920)
Ok in my next article I will go into detail on how to do get your money in before 30 June and what else you have to do so that you will be eligible for the super co-contribution this year.