Are you eligible for a spouse contributions tax offset?
ELIGIBILITY
SPouse Contributions Tax offset
To be eligible for the tax offset, your spouse’s income must be $37,000 or less.
Income includes assessable income, total reportable fringe benefits and reportable employer super contributions.
MAXIMUM SPOUSE CONTRIBUTIONS TAX OFFSET
To receive the maximum spouse contribution tax offset, a minimum contribution of $3,000 is required to your spouse’s Superannuation Fund.
Non-Concessional CAP considerations
No tax offset is available when the receiving spouse exceeds their non-concessional cap for the relevant year or has a total super balance greater than $1.9 million.
How does it work?
The maximum tax offset available gradually reduces, until it is no longer available when your spouse’s income reaches $40,000.
This tax offset is calculated as 18% of the amount contributed to your spouse’s Superannuation fund up to the maximum of $540.
examples
a) Spouse’s income = $37,000
Amounts contributed vs Tax Offset
$1,000 = $180
$2,000 = $360
$3,000 = $540
B) Spouse’s income = $38,000
Amounts contributed vs Tax Offset
$1,000 = $180
$2,000 = $360
$3,000 = $360
C) Spouse’s income = $39,000
Amounts contributed vs Tax Offset
$1,000 = $180
$2,000 = $180
$3,000 = $180
As you can see, the closer you are to the $40,000 limit, the lower the tax offset you are eligible to claim.
How do I make the Contribution?
There are two ways to contribute to your spouse’s super:
Split contributions you have already made to your spouse, also known as "contributions-splitting". You need to prepare and lodge a form with your Superannuation Fund with all the details on the contribution.
Make a direct contribution to their Superannuation Fund as a non-concessional contribution.
How do i claim the offset?
The offset is claimed when lodging your tax return.
Note: this is unlikely to be pre-filled, so you will need to ensure you include it in your tax return (if lodging by yourself), or providing your tax agent the evidence.
If you want to know more about spouse contributions, book a free consultation with our accredited SMSF Specialist Advisor to discuss your superannuation needs!