By Millinda Cobban, Associate Director, SMSFcentral
Last reviewed 12 August 2026. Figures current for the 2026-27 financial year.
Two years of standing still ended on 1 July 2026, when the SMSF contribution caps both moved. The concessional cap went from $30,000 to $32,500, the non-concessional cap from $120,000 to $130,000, and the bring-forward thresholds shifted with them. Indexation runs off average weekly ordinary time earnings, so the caps sit still until cumulative wage growth pushes them over the next increment, which is why a two-year pause is normal rather than an oversight. Below are the figures that apply for the 2026-27 year and the mechanics behind them.
Concessional contributions: $32,500
Concessional contributions are the ones taxed at 15% inside the fund, or 30% for members caught by Division 293. They cover:
- Employer superannuation guarantee contributions
- Salary sacrifice contributions
- Personal contributions for which the member claims a deduction under s290-150 of the Income Tax Assessment Act 1997
- Amounts allocated to a member from a reserve
The cap belongs to the person, not the fund. If contributions land in an SMSF and an industry fund in the same year, both draw on the one $32,500.
What trips people up is the order of that draw. Compulsory superannuation guarantee is not an optional extra sitting outside the cap, it is the first call on it. With superannuation guarantee at 12%, a member earning $180,000 has $21,600 taken out of their cap before they decide anything, which leaves $10,900 for salary sacrifice or personal deductible contributions. On $270,000 there is effectively nothing left. Members who have carried forward unused cap amounts from earlier years and whose total superannuation balance sat under $500,000 at 30 June 2026 have more room than the headline figure suggests. Unused amounts do not carry forward indefinitely, so they are worth checking before they lapse.
The concessional cap indexes in $2,500 increments under s291-20 of the ITAA 1997.
Non-concessional contributions: $130,000
Non-concessional contributions come from after-tax money, and the fund pays no tax on receiving them. The cap always sits at four times the concessional cap, so 4 x $32,500 gives $130,000. It captures:
- Personal contributions with no deduction claimed
- Spouse contributions, which count against the receiving spouse’s cap rather than the contributor’s
- Small business sale proceeds that fall outside a specific CGT concession
- Excess concessional contributions a member elects to leave in the fund, which reclassify as non-concessional
The total super balance gate
A member can only make non-concessional contributions if their total superannuation balance at the previous 30 June sat below the general transfer balance cap. That cap was $1.9 million for 2023-24 and 2024-25, $2 million for 2025-26, and it is $2.1 million from 1 July 2026. A member whose balance at 30 June 2026 reached $2.1 million has a non-concessional cap of nil for 2026-27, regardless of age or work status.
The bring-forward rule
Members under 75 can bring forward up to three years of non-concessional contributions into a single year. Nobody elects into it: contributing more than the annual cap triggers it automatically, which is part of why accidental breaches happen.
How many years a member gets depends on their total superannuation balance at the previous 30 June. Under $1.84 million gives the full three years and $390,000. From $1.84 million to under $1.97 million gives two years and $260,000. From $1.97 million to under $2.1 million there is no bring-forward at all, leaving the standard $130,000. At $2.1 million or more the cap is nil. Those are the tiers the ATO has published for 2026-27, and they follow directly from the $130,000 annual cap and the $2.1 million transfer balance cap.
Two points matter more than the tiers themselves. First, once a bring-forward period starts, the total locks in at the caps applying when it began. A member who triggered a three-year period in 2024-25 has $360,000 across 2024-25, 2025-26 and 2026-27, and the higher cap does not lift it. Only new periods triggered from 1 July 2026 get the benefit of $390,000. Second, the trustee has to track the aggregate across the whole period, not each year in isolation, because excess non-concessional contributions attract a 47% penalty rate.
Consider Maria, who is 58 with a total superannuation balance of $1.2 million at 30 June 2026 and $350,000 from a property sale she wants to put into her SMSF. Her balance sits below $1.84 million, so the full $390,000 is available. Contributing $350,000 in July 2026 triggers a three-year period, and she has $40,000 of room left across 2027-28 and 2028-29. Had her balance been $2.02 million instead, she would have been limited to $130,000 for the year with no bring-forward, though her concessional cap of $32,500 would have been untouched, because total superannuation balance does not restrict concessional contributions.
The thresholds that sit alongside the caps
The CGT cap, which applies to contributions from the proceeds of a qualifying small business CGT event, is $1,935,000 for 2026-27, up from $1,865,000. It is a lifetime limit indexed annually, it sits outside both the concessional and non-concessional caps, and Subdivision 292-C of the ITAA 1997 governs it.
At the other end, the government co-contribution still matches personal after-tax contributions up to $500 for eligible members. The lower income threshold is $49,293 for 2026-27 and the higher threshold $64,293, up from $47,488 and $62,488. The entitlement phases down between the two. Spouse contributions carry their own offset of up to $540, available in full where the receiving spouse’s income is $37,000 or less and phasing out at $40,000 under s290-230.
Division 293 works in the opposite direction. Members whose income plus concessional contributions exceed $250,000 pay an additional 15% on the contributions, which brings the effective rate to 30%. That threshold has not moved since 2017-18 and it is not indexed, so a rising cap steadily pulls more people into it. The arithmetic now catches anyone with $217,500 of Division 293 income who contributes the full $32,500. The ATO issues the assessment after processing both the member’s return and the fund’s return, and the member can pay it personally or release it from the fund.
Timing: when does a contribution count?
A contribution falls into the year the fund receives it, not the year the member sent it. This is the single most common cause of an unintended cap breach we see, and it is entirely avoidable. Money transferred on 29 June that lands on 2 July counts against the following year. Allow at least three business days for electronic transfers, five for BPAY, and considerably longer for a cheque.
Employer contributions carry the same risk. Payday super has applied since 1 July 2026, requiring superannuation guarantee to reach the fund within seven business days of each payday, but clearing house processing still runs inside that window. Superannuation guarantee on June wages that arrives in the first week of July counts against the new year’s cap, not the year the member earned the wages. Getting this right is a routine part of contribution administration.
Where the caps are exceeded
Excess concessional contributions land in the member’s assessable income, with a 15% offset recognising the tax the fund already paid. The member can elect to release up to 85% of the excess from the fund. Leaving it there has a sting: the excess then also counts towards the non-concessional cap for that year, which can turn one breach into two.
Excess non-concessional contributions are harsher. The ATO issues a determination offering release of the excess plus an associated earnings amount, taxed at the member’s marginal rate. Decline the release and the full excess is taxed at 47%. There is no good reason to end up here, and accurate tracking through the year is what prevents it.
2025-26 and 2026-27 side by side
| Cap or threshold | 2025-26 | 2026-27 |
|---|---|---|
| Concessional cap | $30,000 | $32,500 |
| Non-concessional cap | $120,000 | $130,000 |
| Bring-forward (3 years) | $360,000 | $390,000 |
| TSB threshold for full 3 year bring-forward | Under $1.76 million | Under $1.84 million |
| CGT cap amount | $1,865,000 | $1,935,000 |
| Division 293 threshold | $250,000 | $250,000 (not indexed) |
| TSB for carry-forward eligibility | Under $500,000 | Under $500,000 |
| General transfer balance cap | $2 million | $2.1 million |
| Superannuation guarantee rate | 12% | 12% |
Common questions
Do the caps relate to the transfer balance cap?
They are separate limits doing different jobs. Contribution caps govern what goes into super. The transfer balance cap governs how much can move into the tax-free retirement phase. Super above the transfer balance cap is perfectly permissible, it simply stays in accumulation where earnings attract 15% tax.
Should I increase my salary sacrifice now the cap has risen?
The extra $2,500 of room exists, and whether to use it depends on circumstances we cannot assess for you. If you decide to, the arrangement runs through your employer’s payroll, so that is where the change has to be made.
Will the caps rise again next year?
Nobody announces this in advance. The concessional cap moves in $2,500 increments and the non-concessional cap in $10,000 increments as four times that figure, and only once cumulative wage growth carries past the next increment. A year or two of no change is the norm.
Have your fund’s position checked
We review member contribution positions against the current caps as part of preparing the fund’s annual return, and we would rather flag a looming breach in March than explain one in November. If you would like your fund looked at, call 02 8412 0086 or email [email protected].
This is general information only, not personal financial advice. SMSFcentral does not hold an Australian Financial Services Licence.