How much can I contribute in year 4 of a bring-forward period?

https://youtu.be/pBetxN1zt74 Note: This video was recorded when the contribution limits were lower. Q: I understand the bring-forward strategy, which allows up to $330,000 or three years after tax contributions (3 times $110,000) to be made in a single year, or alternatively, various amounts up to $330,000 over a three-year period. If you take this up but contribute, say, only $300,000, so $30,000 short in the three years, then in year four, are you able to contribute after tax of $110,000 plus the $30,000 shortfall from years one to three? A: The contribution rules are anything but easy, especially when you look at the rules around the carry-forward or the bring-forward rules. It’s not easy but the way I like to explain it is, essentially, in the very first year where you make a non-concessional contribution above the annual limit, so in this case, above $110,000, as soon as that contribution goes above $110,000 for the year, you trigger, you automatically enter the three year bring-forward period. So, as soon as our contributions in year one or in the first year you go above $110,000, that becomes the first year of the three year bring-forward rule, which means that year and the next two financial years, we can put in a total of $330,000. Now, at the end of that third year, it resets. So, if you haven’t used up all of that $330,000, you lose it. So, use it or lose it, essentially, over that three-year period. So, it would then restart in that next period where you would have the $110,000. Or again, you could trigger the bring-forward rule to make that $330,000 contribution under the bring forward rule. So, it’s essentially a use it or lose it over those three years. Now, we’ve also got some pretty good articles and guides on the website. I’ve just given you there three or four articles which cover the non-concessional contribution rules . Particularly, there was one released in July this year which is a guide to the bring-forward rule. Probably a good source of information if you’re looking for more on that.

If I make bring-forward contributions, do I have to wait 3 years before I can start a pension?

https://www.youtube.com/watch?v=eY-Fd4swFI4 Q: I’m a self-funded retiree and about to turn 60. I would like to make a $390,000 contribution to my accumulation super, $30,000 concessional plus $360,000 non-concessional using the bring-forward rule. Can I immediately, after making these contributions, transfer my accumulation super to a pension account, or do I need to wait three years due to the bring-forward? A: There’s a few little issues that we need to look at here. The 30 second answer is no, you don’t need to wait your three years. If you’ve met a condition of release which allows you access to your money, you could start a pension if you meet those conditions of release. But there are, of course, some other bigger issues that we need to keep in mind. I suppose the first one is when you’re making non-concessional contributions, or when you’re looking to access that three-year bring forward rule, which allows you to put in a larger amount, you need to make sure that you do check your total super balance, exactly what we just went through before. Remember that your total super balance on 30th of June last year, so 30th of June 2024, last financial year, affects our ability to make non-concessional contributions or how much of our non-concessional cap we can use up. The annual $120,000 non-concessional cap applies unless we use the bring forward rule, which allows us to contribute up to $360,000 in any one year, or combination of years over a three-year period. It allows us to make larger contributions, for instance, if we’re looking to retire and start pensions, or we’re younger and we come into other amounts of money. There are also age restrictions on making non-concessional contributions. We can do it anytime up until age 74, so not yet 75. The non-concessional bring forward rules can also be made up to age 74, not yet 75. Check your total super balance on 30th of June 2024. If it was above $1.9 million, then your non-concessional cap this year in the 2025 year is zero. If you’re not below that general transfer balance cap, if your TSB is not below that $1.9 million, then your non-concessional cap is zero. Any amount you make this, you will be excess.If it was between $1.66 and $1.9 million, I’ll show you that shortly, then you may have reduced access to that three-year bring forward rule. You mentioned, can you do this now? Of course, you need to check all of those things, your TSB, to make sure you fall within those levels. Also just think about whether you may have triggered the three-year bring forward rule last year or the year before, or even, say, 2022 or 2023. Are you still within that three-year period? If so, think about how that might affect you. For those looking to make larger non-concessional contributions under the three-year rule, this is quite an important slide. The left hand side looks at what your total super balance was on 30th June last year, and then how much you can use under the non-concessional contribution cap rules this year. For instance, as I mentioned before, if your total If your total balance is above $1.9 million, then your non-concessional cap this year is zero. Any amount will be excess. If your total super balance was below $1.66 million on 30th June 2024, then you could use the full three-year bring forward all that $360,000 to be contributed. Please do keep these in mind, especially if you do fall between those two brackets, because it may restrict how much you can contribute using the non-concessional contributions. To get to the specific question, the money is in there, we’re assuming it’s all been done in a compliant way, you then do not need to wait for that three-year bring forward rule to end before you start a pension. The contribution has been made, it’s been allocated to your account, it’s a member benefit. In order, of course, to start the pension, you do need to meet a condition of release that allows you to access your super benefits. Now, when I look at the question that has been posed, you’re probably falling into that bottom blue box there, which is retirement after age 60. If you do cease an arrangement under which you’re gainfully employed, and that happens after you turn 60, then all your money at that time becomes unrestricted, not reserved. You can start a pension. What we’ve looked at here is the ability to make the contribution, once it’s been accepted, if you meet a condition of release, that we’re looking at on this slide, you can then start a pension. You don’t need to wait for that three-year period to come to an end. When it comes to non-concessional contributions, there are some tricky things to be aware of, as I mentioned, with those brackets on balances. Jump on and have a look at the non-concessional super contributions guide. It takes you through all that, and it might just be a handy reference tool for you if you’re looking to make a larger non-concessional contribution amount. It’s something certainly worth looking at. If you’re someone now looking to then access your money after you’ve made those contributions, have a look at the recently updated article around accessing super. This covers all the conditions of release. It sets out all the conditions that need to be met when you want to access some money from super, ranging from retirement through to permanent incapacity. Another great article by Barbara there. Have a look at that around accessing superannuation benefits.

Can I trigger a bring-forward when I'm 75, even though I'll be therefore be 77 in the 3rd year?

Q: I just want to be very clear on the bring forward rule for non-concessional contributions. In the tax year where a person turns 75, can they bring forward 3 years and make a non-concessional contribution of $360,000. I ask this because it means the person will turn 77 in that 3rd and final tax year (ie. be well passed age 75!) A: Yes, a person turning 75 during the financial year can use a three-year bring forward arrangement but the contribution(s) must be made before they turn 75, or within 28 days of the end of the month they turned 75 at the latest. The individual will be over 75 during the second and third year of the arrangement but this does not prevent them from using the rule, only from physically making contributions after the cut off. Keep in mind that the total super balance must have been below $1.66 million last 30 June to use a three-year bring forward in the current financial year.

Can you use the downsizer and bring-forward rules together?

Q: Can you advise me whether both the Downsizer Rule and the Bring Forward Rule can be used concurrently? For example to facilitate 2 large amounts from the sale of one’s residential home going into one’s Super Accumulation account? Yes, the downsizer and bring forward rule can be used together. For example, one individual could make a $660,000 non-concessional contribution during 2025-26 using a three-year bring forward arrangement and the maximum $300,000 downsizer contribution together. This assumes the individual is eligible to use the 3-year bring forward arrangement and is not already in an active bring forward period. It is not necessary to separate the contributions from one another. One large contribution can be made, and part of that contribution can be notified to the fund as a downsizer amount. Learn more in our case study demonstrating combining bring forward with downsizer .

Bring-forward rule explained: How to make large super contributions

In this guide

What is a bring-forward arrangement?
Who is eligible to use a bring-forward arrangement?
How do I start a bring-forward arrangement?
Common questions about the bring-forward rule

Key points about the bring-forward rule:

Eligibility: Below 75 years old, not already in an active bring-forward period and total super balance below $1.84 million on 30 June 2026 to start a three-year arrangement in 2026–27.
How it works: Contributing more than the annual non-concessional cap brings forward cap space from future years, allowing larger contributions without exceeding the limit.
Tax treatment: Non-concessional contributions come from after-tax money, so there’s no contribution tax.
Important deadline: Contributions must be made before your 75th birthday, or within 28 days after the end of the month you turned 75 at the latest.

In the run-up to retirement, putting some extra money into your super can be a sensible idea. The same goes if you’re lucky enough to receive an inheritance or sell a large asset.

Not only will it give your retirement savings a boost, but when you withdraw super in retirement phase the income is generally tax free.

However, the contribution caps (or limits) can make it tricky to get a large amount of after-tax money into your super account in a single year. One solution is to use a bring-forward arrangement.

What is a bring-forward arrangement?

Watch our video guide below, or continue reading for in-depth detail on how the bring-forward rule works.

SuperGuide members have access to an extended version of this video with examples demonstrating effective use of the rules and traps to watch out for.

Learn more about becoming a member.

Although it sounds complicated, bring-forward contributions are just what they sound like. You can automatically bring forward your non-concessional contributions caps (or limits) from future years to contribute more than the non-concessional cap during a financial year without generating excessive contributions and paying additional tax.

Bring-forward arrangements are different from carry-forward contributions, which involve using previously unused concessional (before-tax) contributions cap amounts on a rolling five-year basis. Bring-forward arrangements, on the other hand, involve non-concessional contributions.

Learn about carry-forward contributions.

Need to know

Bring-forward arrangements use non-concessional contributions and are made using your after-tax income or savings. The contributions are not taxed as they enter your super fund but, once they’re there, associated investment earnings are taxed at a maximum of 15%.

The annual non-concessional (after-tax) contributions cap is $130,000 in 2026-27.

A bring-forward arrangement is triggered automatically if you are eligible and you contribute more than the annual non-concessional cap in a single financial year. Once you trigger a bring-forward arrangement, you have a bring-forward period, which usually lasts three financial years including the year you triggered the arrangement.

When the rule is triggered, your bring-forward amount is set. This is three times the annual cap for a three-year arrangement. If you do not contribute more than your bring-forward amount during your bring-forward period, you will not generate excessive contributions and will not need to pay additional tax.

For example, you could contribute three times the cap in the first year and make no further contributions in the second and third year. Alternatively, you could contribute one and a half times the cap in the first year and spread the remaining amount over the two following years.

If your total superannuation balance was higher than $2.1 million on the previous 30 June, your non-concessional cap is zero and you cannot use the bring-forward rule.

Need to know

Once you trigger a bring-forward arrangement in a particular year, any change to the non-concessional contributions cap during your bring-forward period will not apply to you. The amount you can contribute during your bring forward period is calculated based on the cap during the year you triggered the arrangement.

Who is eligible to use a bring-forward arrangement?

If you want to use the bring-forward rules, you need to check you meet all of the three eligibility criteria before you make your contribution:

Eligibility criteria 1: Age

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About the author

Janine Mace

Janine has over 25 years’ experience writing about superannuation, including a decade as Managing Editor of the ASFA’s highly respected industry magazine, SuperFunds. She has worked with a range of super funds and leading institutional investment managers. Her work has appeared in the Australian Financial Review personal finance section and she has been a regular contributor to Money Management and Financial Planning magazines.

IMPORTANT: All information on SuperGuide is general in nature only and does not take into account your personal objectives, financial situation or needs. You should consider whether any information on SuperGuide is appropriate to you before acting on it. If SuperGuide refers to a financial product you should obtain the relevant product disclosure statement (PDS) or seek personal financial advice before making any investment decisions. Comments provided by readers that may include information relating to tax, superannuation or other rules cannot be relied upon as advice. SuperGuide does not verify the information provided within comments from readers. Learn more

Responses

kiwi4672@hotmail.com

3 August 2023

Very useful informative article on this overly complicated ATO rule.

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Carmen

28 April 2020

Found this article very helpful and examples are good to get a better grasp of the different scenarios.

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