Non-Concessional Contributions: Boosting Super with After-Tax Money
Already maxed out your concessional cap? Non-concessional contributions let you add more to super using after-tax money—with no contributions tax, and powerful tax-free earnings once in pension phase.
What Are Non-Concessional Contributions?
Non-concessional contributions (NCCs) are contributions made from money that has already been taxed. Unlike concessional contributions:
- No 15% contributions tax (you've already paid tax on the money)
- No tax deduction for the contributor
- Counts toward your non-concessional cap
- Investment earnings taxed at 15% (0% in pension phase)
The Non-Concessional Cap
| Cap Type | 2024/25 |
|---|---|
| Annual NCC cap | $120,000 |
| Bring-forward cap (under 75) | $360,000 over 3 years |
| Total Super Balance limit | $1.9 million |
Important: If your Total Super Balance is $1.9 million or more, you cannot make any non-concessional contributions. At $1.68-1.9 million, your bring-forward is reduced.
The Bring-Forward Rule
If you're under 75, you can "bring forward" up to 3 years of NCCs in one year. This is useful when you have a lump sum (e.g., from selling a property or an inheritance).
- Triggered automatically when you contribute more than $120,000
- Once triggered, you have 3 years to use the full $360,000
- Must be under 75 at the start of the financial year you trigger it
Example: In July 2024, you contribute $250,000 NCC. This triggers the bring-forward rule. You can contribute another $110,000 over the next two financial years (for $360,000 total).
Why Make Non-Concessional Contributions?
1. Tax-Free Earnings in Pension Phase
Once you retire and start an account-based pension, investment earnings become completely tax-free. The sooner money is in super, the more it benefits.
2. Build Tax-Free Component
NCCs become part of your "tax-free component." When withdrawn, this portion is never taxed—even before you reach 60.
3. Get Money into Super Before Caps Reduce
Once your Total Super Balance exceeds $1.9 million, you can't make NCCs. Contributing earlier preserves the opportunity.
When It Makes Sense
- You've already maxed concessional contributions
- You have spare cash (inheritance, property sale, savings)
- Your Total Super Balance is under $1.9 million
- You're approaching retirement and want to maximise super
- You want to increase your tax-free component
When It Doesn't Make Sense
- You haven't maximised concessional contributions (get the tax deduction first)
- You need access to the money before preservation age
- Your super balance is already near $1.9 million
- You're over 75 and haven't met the work test
How Talk Through Wealth Helps
Model your NCC strategy:
- Calculate available NCC cap including bring-forward
- Track Total Super Balance against the $1.9 million limit
- Model the long-term impact of lump sum contributions
- Compare NCC vs. investing outside super
- Plan the optimal timing for large contributions
Optimise Your Super Contributions
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