Super when you work for yourself

Nobody is going to do this for you

As a sole trader you are a business owner, not your own employee. You don't pay yourself wages through a payroll, so the 12% super guarantee an employer owes their staff doesn't apply to what you pay yourself. Nothing is withheld, nothing is compulsory, and nobody sends a reminder.

That is the whole problem. An employee's super happens whether they think about it or not; a sole trader's happens only on the days they decide to make it happen. Twenty years of not deciding is a retirement funded entirely by the pension.

The deal on offer

A personal contribution you claim a deduction for is called a concessional contribution. It comes out of your before-tax profit, and it is taxed at 15% inside the fund instead of at your marginal rate.

So the saving is the gap between your marginal rate and 15%. If your business profit puts you in the 30% bracket, a dollar into super costs you 15 cents of tax instead of 30 — and the whole dollar is still yours, just not until you retire. That last part is the catch, and it is a real one: super is locked away until you reach preservation age and meet a condition of release. Money you might need next winter does not belong in there.

The caps for 2026–27

The concessional cap — before-tax contributions, including anything you claim a deduction for — is $32,500 for 2026–27. That is up from $30,000, where it sat for the two years before.

The non-concessional cap — after-tax contributions you do NOT claim a deduction for — is $130,000. People under 75 can bring forward up to three years at once, to $390,000, though a large existing balance can reduce or remove that.

If your total super balance was under $500,000 at 30 June of the previous year, you can also carry forward unused concessional cap from up to five earlier years and use it in one go. That is the provision built for people with uneven income, which is to say most sole traders: a lean few years followed by a good one can be caught up in the good one.

The form that decides whether you get the deduction

Paying the money in is not enough. To claim a deduction you must give your fund a valid notice of intent to claim, and the fund must acknowledge it. Until that acknowledgement arrives you are not entitled to the deduction — the ATO's wording, not ours.

The deadline is the day you lodge that year's tax return, or 30 June of the following financial year, whichever comes first. Lodge the return first and forget the notice, and the deduction is gone for that year.

One more timing trap: the contribution has to be RECEIVED by the fund before 1 July to count for the year just ended. A transfer sent on 29 June that lands on 2 July belongs to the next year. Leave a working week.

If you're older, or you have staff

From 67 there is a work test to satisfy before you can claim a deduction, and from 75 the door largely closes. If either applies to you, check the current rules before you contribute rather than after.

And if you employ anyone — including yourself through a company, if you ever incorporate — super stops being optional and becomes the super guarantee, with its own quarterly deadlines and penalties. That is a different guide, and a good moment to get a registered agent involved.

A sensible habit, not a heroic one

The version that works for most sole traders is small and regular: a fixed amount every month or every quarter, treated like any other bill, rather than one panicked transfer in late June. It smooths the cash-flow hit, it stops the 30 June scramble, and it makes the notice of intent something you do once at the end rather than something you remember at the worst moment.

How much, and whether super is the right home for the money at all, depends on your income, your debts and your age — which is exactly the kind of question a registered tax agent or a licensed financial adviser is for. What's on this page is the general shape of the rules, not a plan for you.