Superannuation is Australia's compulsory retirement savings system. Every Australian worker is entitled to have their employer contribute a percentage of their earnings into a super fund. For the 2025–26 financial year, the Superannuation Guarantee (SG) rate is 11.5%. This rises to a permanent 12% on 1 July 2026.
The Superannuation Guarantee Rate in 2026
The SG rate has been increasing annually since 2021 as part of a legislated schedule. The 12% rate reached in July 2026 is the final rate — no further increases are currently planned. Your employer must pay this contribution on top of your salary (it is not deducted from your pay) at least quarterly into your nominated super fund.
| Financial Year | SG Rate |
|---|---|
| 2025–26 (current) | 11.5% |
| 2026–27 onwards (final rate) | 12.0% |
When Can You Access Your Super?
Super is preserved (locked away) until you meet a condition of release. The most common conditions are:
- Reached preservation age (60) and retired: You can access all your super tax-free as a lump sum or income stream.
- Turned 65 (regardless of work status): You can access super freely at 65, even if still working.
- Transition to Retirement (TTR): From age 60, you can start a TTR pension and draw up to 10% of your balance per year while still working.
- Terminal illness: Tax-free access if life expectancy is under 24 months.
- Severe financial hardship: Up to $10,000 per year if on Centrelink for 26+ continuous weeks and unable to meet basic expenses.
How Super Affects Your Age Pension
This is critical for retirement planning. Once you reach Age Pension age (67), your super balance is counted under the Centrelink assets test. However, how it is treated under the income test depends on whether you have started drawing from it:
- Super in accumulation phase: Counted as an asset but NOT assessed as income. Deeming does not apply.
- Account-based pension (retirement phase): The balance is an asset AND Centrelink deems it to produce income — at 0.25% on the first $62,600 of the balance and 2.25% above that.
Strategic timing of when you convert your super from accumulation to pension phase can significantly affect your Age Pension entitlement. A full guide to Age Pension rates and means tests is available here.
Types of Super Funds
Australia has several types of super funds:
- Industry funds: Not-for-profit, run by unions and employers. Examples: AustralianSuper, Australian Retirement Trust, HESTA. Historically strong performance, lower fees. Open to all workers.
- Retail funds: For-profit, run by banks and financial institutions. Examples: AMP, Colonial First State, BT. Higher fees but wide investment choice.
- Self-Managed Super Funds (SMSFs): You manage your own investments. Maximum flexibility but requires significant time, knowledge and ATO compliance. Generally only worthwhile with $250,000+ in super.
- Public sector funds: For government employees. Often defined benefit funds. Generally closed to new members.
Contributions Caps 2025–26
- Concessional (before-tax) cap: $30,000/year. Includes employer SG, salary sacrifice, and personal deductible contributions. Taxed at 15% in fund.
- Non-concessional (after-tax) cap: $120,000/year. Personal after-tax contributions (no deduction claimed). Not taxed again in fund.
- Bring-forward rule: If your total super balance is under $1.66 million, you can contribute up to $360,000 in non-concessional contributions over three years.
- Downsizer contributions: Australians aged 55+ who sell their home can contribute up to $300,000 each ($600,000 for a couple) from the proceeds outside the normal caps.
For the full interactive superannuation guide with contribution rate tables, fund type comparisons and FAQ, visit the Superannuation guide on CentrelinkRates.