Federal budget 2023/24: what it means for your super

The Federal Government’s budget for the 2023/24 financial year was delivered on 9 May 2023, with a few announcements related to super.

These are:

• Reduced tax concessions for super balances over $3 million
• Payment of super on payday

These measures are included in the ‘Better Targeted Superannuation Concessions and Securing Australians’ Superannuation Package’.

The proposed changes will come into effect in 2025 and 2026, respectively. They will impact all Australians with super, including you as a GESB member.

Note for Retirement Income members: it was also confirmed that minimum pension drawdown rates will return to pre-COVID-19 amounts as of 1 July 2023.

Reduced tax concessions

If you have a super balance of over $3 million, you will have to pay additional 15% tax on the earnings on any amount that exceeds the $3 million threshold. For GESB Super members, this tax is in addition to any tax you already pay on accumulation.

For West State Super and Gold State Super members, your interest will be appropriately valued and will have earnings taxed under this measure in a similar way to other interests. This will make sure funds are treated equally to non-defined benefit schemes.

Proposed start date: 1 July 2025

Payment of super on payday

Legislation will be introduced that means employers will be required to pay super on an employee’s payday. The Australian Taxation Office (ATO) will receive additional resourcing to help it detect unpaid super payments earlier.

This change aims to help improve retirement outcomes for around 8.9 million employees, including for young and low-income workers who are most likely to have unpaid super.

Proposed start date: 1 July 2026

Note: WA public sector employers are already required to pay super contributions in line with their pay cycle under the State Superannuation Regulations 2001.