How much you contribute

How are employer contributions calculated?

Under the Superannuation Guarantee (SG), employers must pay a percentage of each employee's salary into their superannuation. It is the employer's responsibility to calculate and pay this percentage based on the employee's Ordinary Time Earnings (OTE).

Since 1 January 2020, minimum SG contributions are calculated on an employee’s OTE before any salary sacrifice contributions. Any amounts that an employee salary sacrifices to super do not reduce your SG contributions as an employer. You must contribute at least 10.5% (currently) of any employee’s OTE to their nominated super fund.

The minimum superannuation contribution that employers must make is set by the Federal Government under the Superannuation Guarantee.

Some industry agreements and awards specify that employees are entitled to a higher percentage of superannuation than currently nominated by the Superannuation Guarantee. If you are an employer within one of these industries, you must pay your employees the higher superannuation amount. If you fail to do so, you will be in breach of the agreement or award.

From 1 July 2022, the $450 monthly income threshold for SG contributions will be removed. This means that employers must pay SG contributions on all eligible income from 1 July 2022.

Find out more about when to pay super on the ATO page.

What is the current Superannuation Guarantee?

The Superannuation Guarantee is currently increasing. From 2013 to 2025, the Superannuation Guarantee will increase incrementally from 9% to 12%. The current legislated increases are outlined below:

Effective from 1 JulySuperannuation Guarantee
(% of OTE)






2022 (current financial year)10.5

Maximum earnings base

Each financial year, there is a set maximum contribution base for superannuation. This means that in any quarter, employers are not required to pay superannuation on any earnings their employees make above the maximum earnings base.

The maximum earnings base is indexed each year in line with the Average Weekly Ordinary Time Earnings (AWOTE) for Australia. The maximum earnings base for each quarter in the 2022-2023 financial year is $60,220 ($240,880 annually).

Check the ATO for the current quarterly limit.

This limit does not apply to other mandated contributions, such as those paid under an award.

While employers are not bound to make superannuation payments on earnings that exceed this maximum earnings base, they may still choose to do so.

Salary sacrifice payments

Your employees may request that you make additional super payments from their before-tax income as a salary sacrifice.

As noted above, salary sacrificed contributions do not reduce the OTE that you are required to use to calculate your employees' super entitlements. They also do not count towards the amount of SG contributions you are required to make for your employees to avoid the SG charge.

Salary sacrificed super contributions do not form part of the assessable income that is used to determine how much PAYG tax an employee must pay.

Salary sacrifice and income tests

Salary sacrificed super contributions are counted in income tests for some government financial assistance programs, including family tax benefits and Centrelink. Making a salary sacrifice super contribution can affect your employees' eligibility for:

  • Federal Government super co-contribution
  • Spouse contributions rebate
  • Self-employed tax deduction.

You must report to the ATO any salary sacrificed super contributions you make on behalf of your employees as Reportable Employer Super Contributions (RESCs). You must report these RESCs in PAYG annual withholding reports, and in your employees' PAYG payment summaries.

Payroll deductions

Your employees may request you make additional super payments from their after-tax income as a payroll deduction. Making payments in this way reduces the amount of take-home pay the employee receives. However, it does not affect your compulsory superannuation payments under the SG or the amount you withhold as PAYG tax.

Contributions of this type must be paid to the employee's super fund within 28 days of the deduction being made.

Please note we cannot accept voluntary payroll deduction payments for members who have not provided us with their tax file number (TFN).

Contributions caps

Employer contributions and any salary-sacrifice contributions made on behalf of your employees are counted as 'concessional contributions', meaning that they are made with before-tax income. Contributions made with your employees' after-tax income (whether they’re payroll deductions made by you on your employees' behalf, or voluntary contributions made directly by the employee) are counted as 'non-concessional contributions'.

There are limits on the concessional and non-concessional contributions your employees can make each year. Any contributions above this limit will be taxed at a higher rate and will incur an interest charge.

Below are the contribution caps for the 2022-23 financial year.

Before tax
After tax
Types of contributions includedEmployer (including SG of 10.5%)

Salary sacrifice



Government co-contribution1
Contribution cap$27,5002 per year$110,000 per year

Individuals with a total superannuation balance of $1.6 million or more will have a non-concessional contributions cap of nil.

1. Government co-contributions are not counted towards your non-concessional contributions cap.

2. Indexed annually in line with Average Weekly Ordinary Time Earnings, in increments of $2,500 (rounded down).

If you have salary sacrifice or payroll deduction arrangements with your employees, it’s important to keep an eye on the contribution cap. If you’re concerned you might be exceeding this, we recommend you discuss it with them.

Tax deductions for employers

You can claim a full tax deduction for any SG or award super payments you make on behalf of your employees. The contribution must be made to a super fund for the benefit of your employees. A written agreement with an employee permitting you to make salary sacrifice contributions for them allows you to claim a tax deduction on these payments.

Tax has already been applied to the employee’s income. Therefore, you cannot claim tax deductions on any voluntary post-tax contributions your employees make from their take-home pay (such as payroll deductions).

Tax deductions can only be claimed for the financial year in which the superannuation payments were made.

Tax deductions for self-employed people

If you are self-employed, you can claim a full tax deduction on any voluntary contributions you make to your super.

Find out more about making contributions as a self-employed person.