Sometimes, the government can make additional contributions to your super. This super co-contribution is used to help eligible people boost their retirement savings.
For those that are low or middle-income earners and make personal (after-tax) super contributions to your super fund, the government also contributes into your fund, called a ‘co-contribution’, up to $500.
To be eligible for a government super co-contribution, you must meet the following criteria:
- Pass the two income tests (10% eligible income and income threshold tests)
- Lodge your tax return for the relevant financial year
- Have made one or more eligible super contributions to your super account anytime during the financial year
- Be less than 71 years old of age by the end of the financial year
- Not held a temporary visa at any time during the financial year (with the exception of having a prescribed visa or if you are a New Zealand citizen)
- Have a total superannuation balance that is less than the transfer balance cap at the end of June 30 of the previous financial year
- Have not contributed more than your non-concessional contributions cap
For these super co-contributions, you don't need to apply. When you lodge your tax return, the government will work out your eligibility. If your super fund has a tax file number (TFN), the government will pay it into your super automatically.
If you have retired and do not have an eligible super account to accept government co-contributions anymore, you can request it a direct payment. Additionally, if you have more than one super fund, you can nominate the fund of choice you would like your co-contribution to be in.
For more information on Government co-contributions, contact Wagtail Wealth today.
IMPORTANT NOTE: This information is general advice only and does not take into account your personal circumstances, goals and objectives. Therefore, you should consider its appropriateness for your circumstances before acting on this information.