Division 293 Tax
Calculator AU 2026-27

Division 293 of the Income Tax Assessment Act 1997 imposes an additional 15% tax on concessional (pre-tax) superannuation contributions of high-income earners — defined as those with combined Division 293 income plus low-tax contributions exceeding $250,000 per financial year. Introduced 1 July 2012 at a $300,000 threshold; reduced to $250,000 from 1 July 2017. The tax is on top of the standard 15% contributions tax that all concessional contributions pay inside super, making the effective rate on concessional contributions 30% for affected high earners. Despite this, the 30% rate is still lower than the top marginal rate of 47% (45% income tax + 2% Medicare levy), so concessional contributions remain tax-effective even with Division 293.

Division 293 income includes: (1) Taxable income (before super contributions deduction); (2) Reportable fringe benefits (grossed-up); (3) Net investment loss (rental + financial — added back to income for surcharge purposes); (4) Reportable super contributions (salary sacrifice + personal deductible); (5) Foreign income (sub-divisions 770 and 768); (6) Less super lump sum taxed elements with zero tax rate. NOT included: Social Security benefits, child support received, capital gains discount. Then ADD low-tax contributions (= concessional contributions less excess concessional contributions). Total = Div 293 income. If above $250,000, the excess is the Div 293 base. Threshold has NOT been indexed for inflation since 2017 enactment.

15% rate. Applied to the LESSER of: (a) low-tax contributions (i.e., total concessional contributions including 12% SG, salary sacrifice and personal deductible contributions — capped at the $32,500 concessional cap for FY 2026-27), OR (b) the amount by which Division 293 income PLUS those low-tax contributions exceeds $250,000. Example: someone on $255,000 taxable income with $25,000 of concessional contributions. Division 293 income plus contributions = $280,000, so the excess over the threshold is $30,000. Lesser of (a) $25,000 contributions or (b) $30,000 excess = $25,000. Div 293 tax = 15% × $25,000 = $3,750. Combined with the 15% contributions tax already paid inside super, total tax on the $25,000 concessional = $7,500 (30%) — vs $11,750 (47%) if taken as salary. Net saving still $4,250 per $25,000 contributed. Note the contributions are added to income BEFORE the threshold test, which is why a $255,000 salary already produces a $30,000 excess.

Two options when you receive the Division 293 assessment from the ATO (typically 6-12 months after lodging your income tax return): (1) Pay from outside super — use personal cash, savings, or other after-tax money. Pay within 21 days of assessment to avoid general interest charge (GIC). (2) Release from super — submit a Division 293 release authority via myGov / ATO. ATO sends the release authority to your super fund, which sells assets and remits the requested amount (up to the Div 293 tax assessed) directly to ATO on your behalf. Choose option 2 if cash-poor; choose option 1 if you want to preserve super assets and have liquid funds. The release does NOT count as a contribution withdrawal for preservation age rules — it's a tax-related release authority under §131-25 of TAA 1953.

Yes — Division 293 applies to all 'low-tax contributions', which includes employer Super Guarantee (SG), salary sacrifice and personal deductible contributions. The SG rate is 12% for FY 2026-27; it reached 12% on 1 July 2025 and no further increases are scheduled. But employer SG alone cannot push you over the concessional cap, because of the maximum contribution base: from 1 July 2026 the MCB is an annual $270,830, so the most SG your employer is required to pay for the year is 12% × $270,830 = $32,499.60 — forty cents under the $32,500 concessional cap. A $400,000 employee therefore receives the same $32,499.60 of compulsory SG as a $270,830 employee, and both are inside the cap. What SG does do is consume nearly all of it: on those salaries there is effectively no concessional room left for salary sacrifice. Important: opt-out or a contribution holiday is NOT available for SG, so high earners cannot avoid Division 293 by stopping voluntary contributions once SG alone takes them past the threshold.

Only partially, and often not at all. You can stop salary sacrifice and personal deductible contributions, but employer SG at 12% of qualifying earnings is mandatory and unavoidable. Worked example on a $260,000 salary: SG alone is $31,200. Division 293 income ($260,000) plus low-tax contributions ($31,200) = $291,200, so the excess over the $250,000 threshold is $41,200. The Div 293 base is the lesser of $31,200 and $41,200 = $31,200, giving Div 293 tax of $4,680 — on compulsory contributions you could not have declined. Stopping voluntary contributions only reduces Division 293 where those voluntary contributions are what pushes the base up, and it costs you the 15%-vs-marginal saving on every dollar you stop. At a 30% combined rate against a 47% marginal rate, concessional contributions usually remain net-positive even for people paying Division 293.

Yes, generally. Top marginal rate 2026-27 is 45% + 2% Medicare levy = 47%. Concessional super with Division 293: 15% contributions tax + 15% Div 293 = 30%. Net saving per $1 contributed (vs taking as salary): 47% − 30% = 17 percentage points. On a full $32,500 concessional contribution, that's $5,525 saved per year. Plus tax-advantaged growth inside super (15% on earnings or 10% on capital gains held >12 months in accumulation; 0% in pension phase after preservation age). Caveat: super is locked until preservation age (60 for most), so liquidity trade-off matters. For high earners with stable income, full concessional contributions still beat after-tax investment outside super.

Two separate problems stack. Excess concessional contributions (above $32,500 in FY 2026-27) are treated as income at your marginal rate via Division 291 of ITAA 1997, plus the 15% inside-super tax (refunded to your tax return as an offset). Division 293 applies on top, to the portion of concessional contributions WITHIN the cap. Example: a high earner with $37,500 of concessional contributions, $5,000 over the $32,500 cap. The $5,000 excess is refunded as income and taxed at 45% + 2% = $2,350; the $32,500 within the cap attracts 15% standard ($4,875) plus 15% Division 293 ($4,875) = $9,750. Total tax on the full $37,500 = $12,100, an effective 32.3%. Still cheaper than 47% marginal on $37,500 of salary ($17,625). Because the maximum contribution base caps compulsory SG at $32,499.60, an excess in 2026-27 almost always comes from voluntary contributions or from having more than one employer.

Yes — Division 293 applies identically regardless of whether contributions go to a retail fund, industry fund, or SMSF. The fund type does not affect the tax. Concessional contributions are tracked at the ATO via Member Contribution Statements (MCS) filed by all funds annually. The ATO aggregates all your super contributions across all funds for both concessional cap testing (Division 291) AND Division 293 calculation. SMSF members with multiple member funds may need to use the contributions splitting election to manage between spouses — but Division 293 is calculated per-member, not per-fund.

Not under current legislation. The $250,000 threshold has been static since 1 July 2017 (raised from $300,000 a year earlier). Real bracket creep means a household earning the same real income as a 2017 $250,000 earner is now well above the threshold due to ~22% cumulative inflation since 2017. No current bipartisan proposal exists to index. The 'Better Targeted Superannuation Concessions' measure — Division 296 — is now law and applies from 1 July 2026: an extra 15% on the proportion of earnings attributable to a total super balance above $3 million, and a further 10% above $10 million, with both thresholds indexed to CPI. It is separate from Division 293 because it taxes BALANCES, not contributions, and the two can apply to the same person in the same year. The $250,000 Division 293 threshold itself remains unchanged in current legislation despite multiple industry submissions calling for indexation.