“Bring-forward non-concessional contributions” refers to a provision in the Australian superannuation system that allows individuals to make larger non-concessional (after-tax) contributions to their superannuation fund by bringing forward the contributions cap from future years.

Here’s how it works:

  1. Non-concessional contributions cap
    Normally, there is an annual limit on the amount of non-concessional contributions you can make to your superannuation. For the 2023-24 financial year, this cap is $110,000.
  2. Bring-forward rule
    If you are under 75 years of age at any time in a financial year, you can potentially bring forward up to two additional years’ worth of non-concessional contributions, allowing you to contribute up to three times the annual cap in a single year. This means you could contribute up to $330,000 (i.e. $110,000 x 3) in one year without exceeding the cap.
  3. Your eligibility to use the bring-forward rule depends on your total superannuation balance at the end of the previous financial year. If your balance is less than $1.68 million, you can use the full bring-forward amount of $330,000. If your balance is between $1.68 million and $1.79 million, you may still be able to use a reduced bring-forward amount.
  4. If your superannuation balance is $1.9 million or more, you cannot make any further non-concessional contributions, including under the bring-forward rule.

The bring-forward rule allows individuals to boost their retirement savings significantly in a short period, but it is important to be aware of the limits and potential tax implications of exceeding them.

If you have any questions about how much you can contribute to your SMSF, please contact Diana at The SMSF Accountant.