What is the division 293 tax for high income earners?

If you are a high income earner, your marginal tax rate is higher than an average income earner. When you make concessional contributions to your fund, you receive a larger tax concession. Division 293 imposes an additional tax of 15% to bring the concession back to an amount in line with the average.

How does the division 293 tax work super surcharge for high earners?

When you make a concessional contribution into your super account, however, you only pay a 15% tax rate. To make things fairer, Division 293 imposes an additional tax of 15% on higher income earners to bring the amount of tax they save on their super contributions closer to that paid by someone on an average income.

What is the maximum employer super contribution for 2021?

For 2021/22 the maximum superannuation contribution base is $58,920 per quarter. An employer does not have to pay super guarantee for the part of earnings above this limit.

How much tax do you pay on 200k in Australia?

Income tax calculator Australia If you make $200,000 a year living in Australia, you will be taxed $64,667. That means that your net pay will be $135,333 per year, or $11,278 per month. Your average tax rate is 32.3% and your marginal tax rate is 47.0%.

How can high income earners reduce taxes?

Personal

Claim deductible expenses.
Donate to charity.
Create a mortgage offset account.
Delay receiving income.
Hold investments in a discretionary family trust.
Pre-pay expenses.
Invest in an investment bond.
Review your income package.

When did Division 293 tax start?

1 July 2012
From 1 July 2012, an additional 15% tax (known as Division 293 tax) was introduced. It reduces the tax concessions on superannuation contributions for individuals with income greater than $250,0001 a year. The Division 293 tax is payable in addition to the standard 15% contributions tax.

How much super can I contribute to 65?

If you are aged 65 or over, a downsizer contribution of up to $300,000 can be made into your super account using the proceeds from the sale of your home. For couples, both partners can make a downsizer contribution, so you can contribute up to $600,000 per couple into your super accounts.

What is the current superannuation cap?

What are the super contribution caps for 2021-22? The current caps are: Before-tax super cap: $27,500 (including employer contributions) – but could be more where members use the ‘carry forward’ rule. After-tax super cap: $110,000 – but could be more where members use the ‘bring forward’ rule.