New $32,500 Super Cap: How Much More to Salary Sacrifice?

On 1 July 2026, the amount you can put into super before tax rose to $32,500 a year, up $2,500 from $30,000. If your salary sacrifice arrangement was set up around a $30,000 cap, there's $2,500 of extra room. Below: how much room you have at your salary, what each sacrificed dollar saves in tax, and how to use unused cap from earlier years before the 2021–22 amount expires on 30 June 2027.

What changed on 1 July 2026

Super has one before-tax contribution limit called the concessional contributions cap. It rose from $30,000 to $32,500 on 1 July 2026, because the cap is indexed to wage growth in $2,500 steps. That single cap covers everything that goes into super before tax:

• Compulsory employer Super Guarantee (SG): 12% of your ordinary earnings (the final legislated rate)
• Salary sacrifice: extra before-tax pay you choose to send to super
• Personal deductible contributions: money you pay in yourself and claim as a tax deduction

Added together, they can't exceed $32,500 for the year unless you have unused cap from earlier years (see below). If you go over, the excess is added to your taxable income and taxed at your marginal rate, with a 15% tax offset for the tax your fund already paid.

How salary sacrifice saves you tax

Money you salary sacrifice never reaches your pay packet, so it isn't taxed at your marginal rate. It's taxed at a flat 15% inside the fund instead. Your saving per dollar is the gap between the two:

Saving = marginal rate + 2% Medicare levy − 15% contributions tax. Above $250,000, Division 293 tax can lift the in-fund rate to 30% (see the watch-outs below). The saving is smallest at the bottom of the scale: the $18,201–$45,000 band dropped to 15% on 1 July 2026, the same rate the fund pays, so a sacrifice made wholly within that band saves very little income tax.

How much room do you have?

The $32,500 cap already includes your employer's compulsory 12%. Your room to sacrifice extra is the cap minus what your employer already pays in. At 12% SG:

Velofy illustration at 12% SG. Your real figure depends on your exact ordinary earnings and any existing arrangements. At a salary of about $270,830 or more, employer super alone fills the whole $32,500 cap, so there's no room to sacrifice more. Confirm your own number first.

Unused cap from earlier years: the 2021–22 amount expires on 30 June 2027

If your total super balance was under $500,000 on 30 June 2026, you can add unused before-tax cap from the previous five years to this year's $32,500. In 2026–27 that covers 2021–22 to 2025–26. People who've had years of low contributions, such as a career break, part-time work or time overseas, can have a lot of room.

The rules

• The $500,000 test. Your total super balance, across all your accounts, must have been under $500,000 on 30 June 2026. The $500,000 limit isn't indexed. If you were at or over it, you can't use any unused amounts in 2026–27, though you can still contribute up to the $32,500 cap.
• Unused amounts only cover contributions above this year's cap. They kick in once your 2026–27 total passes $32,500.
• Oldest year first. Anything over this year's cap uses your 2021–22 amount first, then 2022–23, and so on.
• Five years, then gone. Each year's unused amount can be used for five years. The 2021–22 amount can't be used after 30 June 2027.
• The money must arrive in time. A contribution counts in 2026–27 only if your fund receives it by 30 June 2027. The date you send it doesn't count, and bank transfers can take several business days.

How to find your unused amounts in myGov

Log in to myGov and go to ATO → Super → Information → Carry-forward concessional contributions. It shows your unused cap for each of the past five years. The figures update after your latest tax return and your fund's reporting are processed, so the 2025–26 amount may change after you lodge your 2025–26 return.

A worked example

Mia earned $82,000 in 2021–22. Her employer paid 10% super that year ($8,200) and she added nothing, so $19,300 of her $27,500 cap went unused. In 2026–27 she earns $120,000. Her employer pays $14,400, which leaves $18,100 of room under this year's cap. Her super balance was $310,000 on 30 June 2026, so she passes the $500,000 test.

To use the whole 2021–22 amount, Mia contributes $18,100 + $19,300 = $37,400 before tax, through salary sacrifice or personal contributions she claims as a deduction. Her taxable income falls to $82,600, still in the 30% band. After the fund's 15% contributions tax, she pays about $6,360 less tax overall (17c per dollar, 2026–27 rates, Velofy tax engine). If she does nothing, her unused 2021–22 amount is gone after 30 June 2027.

Paying it in yourself: send a notice of intent

Salary sacrifice goes through payroll and needs no extra form. If you pay money in from your own bank account and want to claim it as a tax deduction, there are four steps:

1. Pay it into your fund by BPAY or bank transfer (your fund's member portal has the details) so it arrives by 30 June 2027.
2. Send your fund a notice of intent to claim a deduction. Most funds have an online form. Without it, the fund treats the money as an after-tax (non-concessional) contribution and there's no deduction.
3. Wait for the fund's written acknowledgement. The notice has to reach the fund by the earlier of the day you lodge your 2026–27 return or 30 June 2028, and before you withdraw or roll over that money or start a pension with it.
4. Claim the deduction in your 2026–27 tax return at the personal super contributions item (D12), using the amount in the acknowledgement.

You can model what a large one-off contribution grows to with the Super Calculator, and check the tax saved this year with the Salary Sacrifice Calculator. The tax outcome is the same for salary sacrifice and personal deductible contributions.

Four watch-outs before you set it up

• Division 293 (high earners). If your income plus concessional contributions is more than $250,000, an extra 15% applies to those contributions (or to the part above $250,000, if that's smaller), so the in-fund rate becomes 30%. That still beats the 47% top rate including Medicare, but the gap is narrower. The $250,000 threshold isn't indexed. See our guide to how Division 293 works and how the ATO bills it.
• Going over the cap costs you. Contributions above $32,500 (plus any unused amounts you're eligible to use) are added to your taxable income and taxed at your marginal rate, less a 15% offset. Leave a buffer if your income or hours vary.
• It won't cut your HECS. Salary-sacrificed super and personal contributions you claim as a deduction are both added back when the ATO works out your HECS-HELP repayment income, so neither lowers your compulsory repayment. The HECS repayment calculator shows your 2026–27 repayment.
• Personal contributions need the paperwork. A personal contribution is only deductible once your fund has acknowledged a valid notice of intent. Miss it and you can't claim the deduction.

At the very top end, Division 296 tax has applied since 1 July 2026: an extra 15% on earnings linked to the part of a super balance above $3 million. If you're near that level, get specialist advice before adding more.