Superannuation rules in Australia are updated regularly, and 2025 brings a number of changes that affect both employers and individuals. Whether you run a business with staff or you're focused on building your own retirement savings, it's worth understanding what's changing and what it means for you.
Here's a summary of the key updates.
"The super guarantee rate has been on a legislated path to 12% for years — 2025 is the year it gets there. For employers, that means a direct increase in labour costs."
Super Guarantee Rate Reaches 12%
From 1 July 2025, the Super Guarantee (SG) rate increases to 12% — the final step in a multi-year schedule. This means employers must now contribute 12% of each eligible employee's ordinary time earnings to their super fund. If your payroll system or accounting software hasn't been updated, your next pay run may calculate super at the old rate. Check your settings before 1 July.
Concessional Contribution Cap Increase
The concessional contributions cap — the limit on before-tax super contributions (including employer contributions and salary sacrifice) — has increased to $30,000 per year. This is relevant for anyone looking to top up their super via salary sacrifice or claim a personal super deduction. Contributions above the cap are included in assessable income and taxed at your marginal rate.
Non-Concessional Cap and Total Super Balance
The non-concessional cap (after-tax contributions) is now $120,000 per year, with the bring-forward rule allowing up to $360,000 over three years for those under 75 with a total super balance below the relevant threshold. The transfer balance cap — the limit on how much can be moved into pension phase — remains at $1.9 million.
- SG rate: 12% from 1 July 2025
- Concessional cap: $30,000 per year
- Non-concessional cap: $120,000 per year
- Bring-forward: up to $360,000 over 3 years
Super on Paid Parental Leave
From 1 July 2025, super will be paid on government-funded Paid Parental Leave (PPL). Eligible parents will receive super contributions at 12% on top of their PPL payments, calculated and paid annually by the ATO. This is a meaningful improvement for those who take parental leave, particularly women whose retirement savings are disproportionately affected by career breaks.
Key Takeaways
- SG rate rises to 12% from 1 July 2025 — update your payroll software
- Concessional cap is $30,000 — consider salary sacrifice before year end
- Non-concessional cap is $120,000 with $360,000 bring-forward available
- Super will now be paid on government PPL from 1 July 2025
- Review your contribution strategy annually with your accountant
Super strategy is one of the most effective tax planning tools available to both business owners and individuals. If you'd like to review your super contributions before the end of the financial year, get in touch with our team.