The government announced significant amendments to Australia’s superannuation rules in this year’s Federal Budget, but the majority of proposed changes will not apply for the 2016/2017 year.

Superannuation contributions are divided into two categories; concessional (before-tax) and non-concessional (after-tax). Both types of super contributions are subject to a contributions cap.

A contributions cap is a limit on the amount of contributions an individual makes in one financial year (1 July to 30 June).

The cap for concessional contributions for the 2016/2017 financial year was not affected by the 2016 Federal Budget. However, it will be reduced from 1 July 2017.

For the 2016/2017 year, the two annual concessional contributions caps individuals need to be aware of when considering before-tax contribution strategies are:

• $30,000 cap for those aged 48 or younger as of 30 June 2016
• $35,000 cap for those aged 49 years or older as of 30 June 2016

The current legislated rules for non-concessional superannuation contributions, popularly known as after-tax contributions, include an annual cap of $180,000 for one year, or a cap of $540,000 over a three-year period (under the bring-forward rule).