Review salary sacrifice arrangements

From 1 July 2017 all concessional contributions will be subject to an annual limit of $25,000 per annum.

If you currently have a salary sacrifice arrangement in place, and these additional employer contributions together with your employer statutory super contributions total more than $25,000 annually, you will need to review your arrangement with your employer before 1 July 2017.

Employees will need to ensure their total concessional contributions paid by their employer does not exceed $25,000 for the year ended 30 June 2018. Contributions in excess of $25,000 will be liable for excess contributions tax.

All salary sacrifice arrangements need to be documented in writing. The employee needs to agree in writing to forgo a certain amount of income before that income has been earned, in return for benefits of a similar value.  If the ATO want to clarify this point there will need to be documentation and a trail – paperwork and transactions – backing it up.