If your spouse is on a low income, you may be able to make contributions into their super account to reduce your tax payments. This contribution is known as a ‘non-concessional contribution’ and will form part of the tax-free component of your spouse’s super account. You may receive an 18% tax offset when you contribute to your spouse’s super fund (see below for conditions). The offset only applies to the first $3,000 of your contributions in a year, with a maximum offset of $540. The offset reduces as your spouse’s income rises above $10,800pa and cuts out when your spouse’s income is $13,800 pa or more.

What does it mean for you?

Spouse contributions can be an effective way to increase your spouse’s super. As this is a tax offset rather than a tax deduction, you may receive a direct saving against your income tax liability. Using spouse contributions and other available strategies means couples can enjoy more benefits when they save together.

How do you know if you qualify?

You may be entitled to a maximum tax offset of up to $540 each financial year if:

• You did not claim a tax deduction for the contributions
• Both you and your spouse were Australian residents when the contributions were made
• You and your spouse were not living separately and apart on a permanent basis when you made the contributions
• Your spouse is under 70 (or if aged between 65 and 70 they must have worked at least 40 hours within 30 consecutive days)
• Your spouse’s income for the financial year was less than $13,800
• The contribution was made to a complying super fund
• Please note: Under the superannuation law, a spouse is defined as a person who is in a genuine domestic bona fide relationship as husband or wife (married or de facto), including same sex couples.

How much are you entitled to?

The offset is calculated at 18% of the lesser of:

• $3,000, reduced by $1 for every $1 that the sum of your spouse’s income for the year was more than $10,800.
• The total of your contributions for your spouse for the year.

If you would like to see if spouse super contributions are right for you, please contact me, Brett Surman, directly on (08) 6169 0506 or brett@demeterwealth.com.