What is Division 293 tax?

Division 293 tax reduces the tax concession that higher income earners can receive on certain super contributions.

Concessional (before-tax) contributions are generally taxed at a rate of 15%, up to your concessional contributions cap. However, if your income for surcharge purposes plus relevant concessionally taxed contributions (referred to as low tax super contributions) exceed $250,000 in a financial year, then you will be taxed an additional 15% on the taxable contributions.

Taxable contributions will be either the low-tax contribution amount, or the excess above the $250,000 threshold, whichever is the lower amount.

When does the tax apply?

Division 293 tax applied from 1 July 2012.

Does Division 293 apply to West State Super, Gold State Super and WA Public Sector Pension Scheme?

Yes - low-tax contributions include concessional (before-tax) contributions to tax exempt constitutionally protected funds. This includes West State Super, Gold State Super and the WA Public Sector Pension Scheme.

How does the Australian Taxation Office (ATO) calculate Division 293 tax?

The ATO uses a number of steps to calculate Division 293 tax. For more information, visit the ATO website.

How are taxable contributions calculated for Gold State Super and Pension Scheme members?

The ATO has additional steps for defined benefit schemes. To review these, visit the ATO website.

Are there any other special rules?

There are also special rules for Commonwealth judges and justices, and certain WA Government higher level office holders.

To find out more about the special rules that apply, please contact the ATO or visit the ATO website.

How does the ATO collect tax from you?

GESB Super and West State Super

The ATO calculates the tax liability and will issue a notice of assessment to the individual. You will be required to pay this by the due date.

To pay the tax liability, you can either:

  • Pay out of your own pocket – see the ATO website for payment options
  • Choose to have the money released from your existing super account (except for defined benefits, such as Gold State Super) by accessing the ATO’s myGov service and completing a Division 293 election form

Check the ATO website for more information.

Gold State Super and WA Public Sector Pension Scheme

If you have a defined benefit account, payment of your Division 293 tax liability can be deferred. The ATO will set up a debt account for deferred Division 293 tax amounts, and will apply interest to the balance of the debt account until the liability is paid. If you do not pay your debt within 21 days of the date of your assessment, the ATO will automatically set up a deferred debt account for you.

Your debt will become payable when you take a benefit from the super account that the debt relates to. At this time, you can either pay the liability out of your own pocket or by using the release authority issued with the debt account discharge liability notice.

You can also pay the debt earlier, from your own pocket or by using the release authority issued with your assessment to have the money released from another super account you hold. You can also pay using a combination of both methods. This option is only available if your other super account is an accumulation account.

If you are using a release authority, please send your completed form along with all pages of the authority to:

PO Box J 755
Perth WA 6842

Please note: we must receive original copies of this form. We are unable to process forms sent by fax or email.

Check the ATO website for more information.

Where can I get more information?

You can find more information and keep up to date by visiting the Division 293 tax page on the ATO website.

You should also consider seeking more information from a qualified financial adviser, as this is a complex area of tax.

Disclaimer: this information is of a general nature, and does not constitute legal, taxation or personal financial advice. In providing this information, we have not taken into account your investment objectives, financial situation or needs. We are not licensed to provide financial product advice. You should read this information in conjunction with other relevant disclosure documents we have prepared. You may also wish to consult a suitably qualified adviser to ascertain whether this information is appropriate for you.

Page last updated 29 October 2019