Can I put more into super to lower my tax? From 1 July 2026 the cap went up to $32,500

You've had a strong income year, or you've sold something that triggered a capital gain, and someone has told you that putting a bit more into super could take the edge off the tax. It is one of the most common questions an accountant hears in the back half of the year. From 1 July 2026 the answer shifted at the margin — because the ceiling on what you can contribute at the low, concessional tax rate went up.

What actually changed on 1 July

From 1 July 2026 the general concessional contributions cap rose from $30,000 to $32,500, lifted by indexation to average weekly earnings. 'Concessional' means the contributions that go into super before tax — your employer's compulsory super guarantee, anything you salary-sacrifice, and personal contributions you claim a deduction for. Inside the fund they are taxed at 15%. For someone whose marginal tax rate is 30% or 37%, that 15% rate is the whole point: money that would otherwise be taxed at your rate goes in taxed at a flat 15% instead.

The after-tax side moved too. The non-concessional cap — money you put in from income you have already paid tax on, with no further deduction — rose from $120,000 to $130,000 for the 2026–27 year.

The number people forget to subtract

The mistake that catches people out is treating the $32,500 as headroom on top of what their employer already pays. It isn't. The cap includes your compulsory super guarantee. That rate has been 12% since 1 July 2025 — so on a $120,000 salary, roughly $14,400 of the cap is already used before you salary-sacrifice a single dollar. The room you actually have to add is $32,500 minus the super guarantee your employer pays, minus any salary sacrifice already running.

Go over the cap and the benefit reverses: the excess is added back to your assessable income and taxed at your marginal rate, with an interest charge on top. The value is in filling the cap, not overshooting it.

If you missed the cap in earlier years

There is a rule worth knowing for a year with a one-off spike in income. If your total super balance was under $500,000 on 30 June of the previous year, you can carry forward unused concessional cap from up to five earlier financial years — going back no further than 2018–19 — and use it on top of this year's cap. Unused amounts are applied oldest first, and they expire five years after the year they arose. In a year where you have sold an asset or booked an unusually large gain, that carried-forward room is what lets you push more in at the 15% rate rather than at your marginal one.

For larger after-tax contributions there is a parallel 'bring-forward' rule that lets eligible people under the relevant balance thresholds contribute up to three years of the non-concessional cap at once — $390,000 — in a single year. And a separate change from 1 July 2026 introduced an extra tax on the earnings attributable to total super balances above $3 million; that one reaches very few people, but if it is you, it is worth advice before you contribute more.

Super is genuinely one of the last broadly available tax levers, but it is also one of the easiest to trip over — the caps interact with your salary, your existing contributions, your balance, and the timing of when money actually lands in the fund. Contributions only count in the year the fund receives them, not the year you send them, which is why late June is the wrong time to start working it out.

This is general information current as at July 2026, not advice for your situation, and it is not financial product advice about whether contributing suits you. If you have had a high-income year, a capital gain, or unused cap sitting in earlier years, working out how much room you really have — and getting the timing right — is exactly the conversation to have before 30 June, not after. That is what our individual tax return and planning service is for.