Division 293 Tax Calculator
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What is Division 293 Tax?
Division 293 is an additional 15% tax on concessional (before-tax) super contributions for high income earners. It applies when your income for Division 293 purposes (taxable income + reportable fringe benefits + total net investment losses + low-tax super contributions) exceeds $250,000.
The tax is assessed on the lesser of: (1) the amount above the $250,000 threshold, or (2) your taxable concessional super contributions. This means you only pay the extra 15% on the portion of your super that caused you to exceed the threshold.
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Frequently Asked Questions
What is Division 293 tax?
Division 293 is an additional 15% tax on concessional (before-tax) super contributions for high-income earners in Australia. Without Division 293, super contributions are taxed at just 15% inside your fund — a significant discount compared to the 45% top marginal rate. Division 293 adds another 15%, bringing the total tax on affected super contributions to 30%. This applies to employer Super Guarantee contributions, salary sacrifice amounts, and personal deductible contributions. The policy rationale is that the 15% concessional rate provides a disproportionate benefit to high earners (who save 30% tax) compared to low earners (who may save only 1% or even pay more). Approximately 300,000 Australians are affected each year. Source: ATO Division 293 (ato.gov.au).
Who pays Division 293 tax?
You pay Division 293 tax if your 'income for Division 293 purposes' exceeds $250,000 in a financial year. This income measure is broader than taxable income alone — it includes: (1) taxable income, (2) reportable fringe benefits (the grossed-up amount shown on your payment summary), (3) total net investment losses (added back, including negative gearing losses), and (4) low-tax contributed amounts (your concessional super contributions for the year). For example, if your salary is $230,000 and your employer contributes $27,500 in SG + salary sacrifice, your Div 293 income is $257,500 — exceeding the threshold. Note that net investment losses are added back, meaning negative gearing deductions don't reduce your Division 293 income. Source: ATO (ato.gov.au).
How is Division 293 tax calculated?
Division 293 tax equals 15% of the LESSER of: (A) your taxable concessional contributions for the year, or (B) the amount by which your Division 293 income exceeds $250,000. Worked example: salary $260,000, employer SG + salary sacrifice = $27,500, no fringe benefits or investment losses. Division 293 income = $260,000 + $27,500 = $287,500. Excess over threshold = $287,500 - $250,000 = $37,500. Taxable amount = lesser of $27,500 (contributions) or $37,500 (excess) = $27,500. Division 293 tax = $27,500 × 15% = $4,125. If your income just barely exceeds the threshold — say by $10,000 — you only pay 15% on $10,000 = $1,500 (not on the full $27,500 in contributions). Source: ATO Division 293 calculation (ato.gov.au).
Can I reduce my Division 293 tax liability?
There are several strategies to reduce Division 293 tax. First, you can reduce concessional contributions to only the employer SG minimum (12% from FY2025-26) — however this forfeits the tax benefit of salary sacrifice. Second, you can legitimately reduce taxable income through deductions (investment property expenses, charitable donations, prepaid interest) to bring Division 293 income below $250,000. Third, you can elect to pay the tax from your super fund balance rather than from personal cash — this preserves your after-tax income but reduces your retirement savings. Fourth, consider non-concessional (after-tax) contributions instead, which are not subject to Division 293 but don't give an upfront tax deduction. The concessional cap is $30,000 for FY2025-26. Source: ATO (ato.gov.au).
When is Division 293 tax assessed and how do I pay?
The ATO issues a Division 293 tax assessment after you lodge your annual income tax return — typically 2-8 weeks after your Notice of Assessment. You then have two payment options: (1) pay personally from after-tax money within the standard due date (usually 21 days from assessment), or (2) elect to release the amount from your super fund by lodging an election form with the ATO within 60 days of the assessment date. If you choose super fund release, the ATO contacts your fund directly and the amount is debited from your member balance. Most people choose the super release option as it preserves cash flow. If you don't respond within 60 days, the ATO may default to fund release. Late payment attracts the General Interest Charge (currently ~11% p.a.). Source: ATO Division 293 payment (ato.gov.au).