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22 April 2025

A quick reference source to help with some of the key year-end planning matters that may need to be considered for clients.

Managing successful, tax-efficient financial planning strategies is generally a continual process throughout the year. Nevertheless, clients will be prompted to think about their tax planning as the end of the financial year approaches.

We have consolidated some useful reminders and references for financial services professionals to help address some of the main end-of-year questions and issues that may be encountered. This guide provides a quick reference source to help with some of the key year-end planning matters that may need to be considered for clients.

Year end strategies

Super accumulation

Optimise super contributions

Understand Total Superannuation Balance (TSB)

Personal super contributions – claiming deductions

Salary sacrifice strategies - are they effective?

Spouse contribution tax offset

Government co-contribution eligibility

Spouse contribution splitting

Optimise super contributions

Review contribution types and amounts to ensure contributions have been optimised.

Contribution caps for 2024-25
  • non-concessional: $120,000, provided the client’s total superannuation balance (TSB) was less than $1.9 million as at 30 June 2024.

    Access to the non-concessional contribution (NCC) bring-forward rule also depends on the client’s TSB as at 30 June 2024.

    TSB

    NCC cap

    Less than $1.66 million

    $360,000 over three years

    $1.66 million to less than $1.78 million

    $240,000 over two years

    $1.78 million to less than $1.9 million

    $120,000 annual cap
    (Bring forward not available)

    $1.9 million or more

    Nil NCC cap

    Note: The NCC caps above assume the individual didn’t trigger the bring forward rule in the prior two years and is still in a bring forward period.

    If the bring-forward cap is triggered, but not used in full in the 2024-25 year, the remaining cap can only be used in the 2025-26 year where the individual’s TSB is less than $2.0 million at 30 June 2025.

  • concessional: $30,000 unless the individual carries forward their unused concessional contribution (CC) cap.

    The carry-forward CC cap is applied if:
    • actual CCs are greater than the annual CC cap
    • TSB is less than $500,000 at 30 June of prior financial year (ie 30 June 2024 for contributions made in the 2024-25 year), and
    • they have unused CC cap available from any or all of prior 5 financial years.
       
  • small business CGT concession cap: $1,780,000 (lifetime limit).
Tips
  • Check whether the client has any unused CC cap amounts they can use in the current year.

    In many cases, it will make sense for a client to use these amounts, but not always.

    A client who has an unusual boost in their assessable income (for example due to a net capital gain) may benefit from using their carry-forward CC cap to take advantage of tax concessions. However, if their additional CCs will be subject to Division 293 tax (due to the income boost) when this wouldn’t ordinarily be the case, then they may be better off waiting until the following income year. Of course, other factors need to be considered too, including whether the client’s TSB will likely remain below the $500,000 threshold to be eligible to make use of the carry-forward cap.

    Also note that unused CC cap amounts can be carried forward for a maximum of five years. For example, the last year the unused CC cap from 2019-20 can be used will be the 2024-25 year.

  • Check the timing of your clients’ contributions.
    • Check the super fund’s cut off dates to ensure contributions are received in the intended year. Cut off dates for Macquarie products can be found here.
    • For Superannuation Guarantee (SG) contributions, employers have until 28 July 2025 to make contributions for the quarter ending 30 June 2025.
    • Contributions received by a super fund after 30 June 2025 will generally count towards the contributions cap in the 2025-26 financial year, even if they relate to 2024-25. This may impact the client’s contributions caps for next financial year.
    • A non-concessional contribution can only be accepted up until the 28th day after the month the individual turns 75.
       
  • Check the contributions made into all of your clients’ super funds to ensure the relevant caps have not been exceeded.

  • Check the classification of the contributions. Contributions not made by the member themselves (excluding spouse contributions and non-employer contributions made for a child) are generally treated as concessional contributions and count towards the concessional contributions cap. However, contributions made by an employer from the take-home (after-tax) pay of the client are considered by the ATO to be non-concessional contributions.

Further help

Understand Total Superannuation Balance (TSB)

A client’s TSB determines eligibility for the superannuation measures outlined in the table below. TSB is generally measured each 30 June to determine eligibility for the relevant superannuation measure in the following financial year (ie 30 June 2024 for the 2024-25 year).

Determines eligibility for…

TSB threshold for 2024-25

Non-concessional contributions cap and the bring-forward rule

$1.9 million (member TSB)

Carry forward of unused concessional contributions cap

$500,000 (member TSB)

Government co-contribution

$1.9 million (member TSB)

Spouse contribution tax offset

$1.9 million (receiving spouse’s TSB)

SMSFs using the segregated method to calculate exempt income

$1.6 million* (member TSB)

An exemption from meeting the work test in the year following retirement (relevant for claiming deductions for personal contributions)

$300,000 (member TSB)

*this threshold is not subject to indexation

 

Tip
  • If a client’s TSB is approaching the relevant threshold, consider strategies to minimise the client’s accumulation and/or pension balances at 30 June. For example, consider splitting concessional contributions with a spouse or reviewing the timing of contributions or withdrawals.


Further help

Personal super contributions – claiming deductions

Clients intending to claim a deduction for personal super contributions must lodge a deduction notice (using the approved form) with the fund before the earlier of:

  • the day they lodge their tax return for the year in which the contribution was made; or
  • the end of the financial year after the financial year in which the contribution was made.

Key information on how to claim or vary a deduction for contributions made to the Macquarie Superannuation Plan is contained in the Guide to completing the Deduction Notice for Personal Superannuation Contributions.

Tips
  • A deduction for a personal super contribution cannot add to or create a tax loss.
  • Where a client rolls over or withdraws part of their super benefit before a deduction notice has been lodged, the amount of the personal contribution that can be claimed as a deduction will be reduced. This is because part of the contribution is considered to be included in the rollover/withdrawal amount.
  • Where a client uses part or all of their super benefit to commence a pension, a deduction notice cannot be lodged after the pension commences for contributions made prior to the pension commencing.
  • Check the classification. A common trap involves contributions made for self-employed clients being incorrectly classified as employer contributions. Any contributions incorrectly classified as an employer contribution will need to be reclassified as a personal contribution before a deduction notice can be accepted.
  • Be mindful of the concessional contribution cap ($30,000 for the 2024-25 financial year or a higher amount a carry-forward cap can be used). Excess concessional contributions will be included in the client’s assessable income and taxed at marginal tax rates (less a 15% offset for tax paid by the super fund). Clients may elect to withdraw up to 85% of the excess contribution amount. If a client does not withdraw this amount, the excess concessional contribution will count towards the non-concessional contribution cap.
  • A work test applies for individuals aged 67 to age 75 (up to the 28th day after the month they turn 75) who make personal contributions they wish to claim as a tax deduction. For clients within this age bracket that do not meet the work test (or work test exemption) and are unable to claim a deduction for their personal contributions will have these amounts treated as non-concessional contributions by the ATO.

Further help 

Salary sacrifice strategies - are they effective?

Review current and planned salary sacrifice contributions to ensure they are or will be within the concessional contributions cap. Be mindful of employer Superannuation Guarantee contributions relating to the 2023-24 year that may have been received by the client’s superannuation fund after 30 June 2024. These contributions may count towards the client’s concessional contributions cap in 2024-25.

Also review salary sacrifice arrangements for the 2025-26 financial year to ensure an ‘effective salary sacrifice arrangement’ is in place ahead of your client earning the right to certain benefits.

Tip
  • A work test applies for individuals aged 67 to age 75 (up to the 28th day after the month they turn 75) who make personal contributions they wish to claim as a tax deduction. For clients who are within that age bracket, who are employed though don’t meet the work test (or work test exemption), utilising a salary sacrifice arrangement may be a tax effective way to contribute to superannuation.

Further help 
  • TR 2001/10 Income tax: fringe benefits tax and superannuation guarantee: salary sacrifice arrangements

Spouse contribution tax offset

Clients who have a spouse with assessable income, reportable fringe benefits and reportable employer contributions of less than $40,000 could consider making a non-concessional contribution to their spouse’s super fund.

The offset is calculated as 18 per cent of the contribution, up to a maximum of $540 where the spouse's income is below $37,000. A reduced offset may apply where the spouse’s income is between $37,000 and $40,000.

Tip
  • No offset is available where:
    • the spouse’s income is above the $40,000 threshold
    • the spouse has excess non-concessional contributions
    • the spouse’s Total Superannuation Balance exceeds $1.9 million as at 30 June 2024.

Further help 

Government co-contribution eligibility

Is your client's assessable income, reportable fringe benefits and reportable employer super contribution minus deductions from carrying on a business less than $60,400?

  • The client could consider making a non-concessional contribution of up to $1,000 to super.
  • Maximum co-contribution is 50 per cent of the contribution, up to a maximum $500 for income below $45,400.
Tip
  • The co-contribution will not be available where the client has excess non-concessional contributions or their TSB exceeds $1.9 million as at 30 June 2024.
  • Eligibilty requires that a minimum of 10% of assessed income relates to income from employment or carrying on a business.

Further help 

Spouse contribution splitting

Clients can split up to 85 per cent of concessional contributions made during a financial year (up to the concessional contribution cap) with their spouse, provided the spouse is not aged 65 or over, or reached their preservation age and retired.

This includes concessional contributions which utilises the client’s carry-forward unused concessional contribution cap. For example, someone who contributed $37,500 in 2023-24 (being their 2023-24 cap of $27,500 plus $10,000 of their carry-forward cap) would be able to split up to $31,875 (i.e. 85 per cent of $37,500) to their spouse.

The application to split contributions must generally be made before the end of the financial year immediately after the financial year in which the contribution was made. This means that the application to make split contributions for 2023-24 must be made by 30 June 2025 (unless the fund applies an earlier date).

Tip
  • The concessional contributions will still count towards the cap of the spouse who made the contributions and not the cap of the spouse who receives the split contributions.

Further help 

Self managed superannuation funds (SMSFs)

SMSF contribution issues

SMSF trustee issues

Transfer balance account report

Exempt current pension income

SMSF contribution issues

Timing of contributions:

  • Contributions are taken to be made when they are received by the SMSF
  • In-specie contributions can be taken to be made when the SMSF receives all completed documentation necessary to transfer ownership of the asset.

However, depending on the terms of the trust deed, a super fund may accept contributions into a suspense account and allocate them to member accounts within a certain period after the contribution is made. Superannuation law generally requires a trustee to allocate the contribution within 28 days after the end of the month in which the trustee received the contribution (an exception being contributions made via SuperStream which must be allocated within three business days). In the ATO’s view, contributions that are allocated to a member account under these rules will count towards the applicable cap in the financial year in which they are allocated.

Tips
  • For concessional contributions there is a specific form SMSF trustees can use to notify the ATO if this strategy is used to ensure contributions are correctly allocated in both financial years. This form should be completed and lodged with the ATO either before or along with the fund’s annual return.
  • Personal payments of accounting, audit fees and other expenses of an SMSF may be considered to be contributions to the fund.

Further help 

SMSF trustee issues

  • Review and value fund assets to ensure in-house assets are within the five per cent limit.
  • Rebalance portfolios and/or review investment strategies to ensure compliance with the SMSF’s investment strategy.
  • Review meeting minutes to ensure all issues are documented.
  • SMSF trustees are also required to:
    • consider if it is appropriate to hold insurance for fund members
    • regularly review the SMSF’s investment strategy, and
    • ensure the SMSF’s assets are valued at market value for reporting purposes.
Further help

Transfer balance account report

Superannuation funds, including SMSFs, have an obligation to report certain events to the ATO that will impact a member’s transfer balance cap. The transfer balance account report (TBAR) is separate to the SMSF annual return. 

All SMSFs must report TBAR transactions on a quarterly basis from 1 July 2023. The transaction report must be lodged within 28 days after the end of the quarter in which the event occurred.

If a member of the SMSF has exceeded their transfer balance cap and the commutation occurs in relation to an ATO transfer balance determination, the commutation must occur within 10 business days after the end of the month in which the commutation occurs.

Further help 

Exempt current pension income

From 1 July 2017, certain SMSFs were prohibited from using the segregated method to calculate the fund’s exempt current pension income. This restriction applies to funds where a member:

  • has a TSB of more than $1.6 million at the prior 30 June, and
  • is receiving a retirement phase income stream (either paid from the SMSF or another fund).

Impacted funds are required to use the proportionate method (also known as the unsegregated method) to calculate exempt current pension income.

Further help 

ATO: Exempt current pension income

Benefit payments

Ensure minimum pension requirements are met

Clients starting an account based pension

TRIS moving to the tax-free phase

Ensure minimum pension standards are met

Clients with pensions (including account based pensions) must pay at least the minimum amount from their pension account before the end of the financial year.

The minimum pension payment requirements for account-based pensions are as follows:

Minimum percentage factors

Age

2024/25

Under 65

4.00%

65 – 74

5.00%

75 – 79

6.00%

80 – 84

7.00%

85 – 89

9.00%

90 – 94

11.00%

95 and over

14.00%

In the year the pension commences, the following apply:

  • Pension commenced prior to 1 June – pro-rate minimum by number of days in financial year that includes and follows the pension commencement day
  • Pension commenced from 1 June to 30 June – no minimum pension required

If the pension is commuted during the year, the following apply:

  • Commutation in full: Pro-rate minimum by number of days income stream payable in financial year up to commutation date. Must occur before full commutation takes place
  • Pre-commutation minimum payment not required if:
    • commutation is a partial commutation and remaining account balance is sufficient to meet annual minimum payment; or
    • commutation results from death, family law split, surcharge payment or exercise of right under financial product cooling-off period.
Tip

Where the minimum pension has not been paid, the pension may be treated as having ceased at 1 July and will be taxed as an accumulation account. The ATO has published guidance on minimum pension payment requirements for account based pensions payable from SMSFs. The guidance is useful for SMSF trustees who are dealing with situations where the minimum pension payment requirements are not met in a financial year.


Further help 

 

Clients starting an account based pension

Ensure tax deduction notices for personal contributions are lodged

Ensure any tax deductions for personal contributions are claimed (i.e. deduction notice is lodged with the fund and acknowledgement received) prior to commencing the pension. Once a pension has commenced, a deduction notice (including a variation to a valid notice) cannot be accepted in relation to contributions made prior to commencement.


Check clients’ Transfer Balance Caps

The general Transfer Balance Cap (TBC) is $1.9 million for 2024-25. However, not everyone’s TBC equals the general TBC and it is the individuals own circumstances that determine their own TBC.

If the client has a MyGov account and have linked the ATO portal to that account, they can find their TBC information there, including their individual TBC, transfer balance account transactions and cap space. A client’s tax agent can also obtain this information. Keep in mind that there can be small delays with the ATO receiving transfer balance transactions from super funds. Large super funds are required to report transactions within 10 business days of the event. SMSFs are required to report within 28 days after the end of the quarter.

The general TBC will be increasing with indexation to $2 million from 1 July 2025. As noted above, not everyone will benefit from the indexation and the clients’ TBC will depend on their individual circumstances.

Tip
  • Ensure you have accurate personal transfer balance cap information for your clients by, asking them to access this information from ATO online services, or check with their tax agent.

Further help

TRIS moving to the tax-free phase

Transition to retirement income streams (TRIS) are taxed on income within the account in the same way as accumulation accounts.

TRIS move to the tax-free pension phase when the individual turns 65. They also move to the tax-free pension phase when the fund is notified that one of the following conditions of release has been met:

  1. Retirement
  2. Permanent incapacity
  3. Terminal medical condition

Notifying the fund as soon as possible after one of the above conditions of release has been met is usually beneficial as it moves their benefits into the tax-free pension phase as soon as possible. However, keep in mind their transfer balance cap and the possible need to commute a part of the TRIS before notifying the fund.

Personal Taxation

Employment termination

Prepay expenses

Work from home deductions

Employment termination

Clients facing a termination of employment should consider delaying the receipt of any payments until the following financial year if other taxable income is expected to be lower in that year.

Note - From 1 July 2019 the cut off age for genuine redundancy and early retirement schemes was increased from age 65 to pension age. This change has broadened the range of people who will benefit from the associated tax concessions.

For those considering resigning, consideration should be given to taking leave while still employed versus receiving the leave as a lump sum upon ceasing employment as superannuation guarantee contributions are payable on salary or wages while on annual or long service leave but not on lump sum leave payments.


Further help

Prepay expenses

If certain requirements are met, clients may be able to claim a tax deduction for up to 12 months of prepaid expenses, including interest paid in advance on an investment loan, premiums on an income protection policy or trade publication subscriptions. Note the prepayment rules do not apply to SMSFs in relation to limited recourse borrowing arrangements.


Further help

Work from home deductions

In 2024-25, there are two methods available to calculate work from home expenses:

  • Revised fixed rate method
    • 70 cents per hour worked from home (at time of publishing the ATO page ‘Work from home expenses’ linked below showed the old rate of 67 cents and had not been updated to reflect the 2024-25 rate of 70 cents as outlined in PCG 2023/1 below)
    • Excludes decline in value of depreciating assets which can be claimed separately
    • No longer requires a dedicated home office
  • Actual cost method
    • The actual expenses incurred as a result of working from home.

Further help

Looking ahead to 2025-26

Expiry of unused concessional contribution amounts

Contribution caps and thresholds

Expiry of unused concessional contribution amounts

Unused CC cap amounts from the 2020-21 year will expire at the end of 2025-26. Clients who still have unused CC cap from 2020-21 may wish to use it before 1 July 2026.

Further help

Contribution caps and thresholds

The concessional and non-concessional contribution caps will be remaining at their current levels for the 2025-26 financial year. The CGT cap amount will however be increasing with indexation.

Contribution cap

Cap in 2025-26

Concessional contribution cap

$30,000

Non-concessional contribution cap

$120,000

CGT cap amount

$1,865,000

The indexation to the generally TBC has implications for the non-concessional contribution cap total super balance thresholds (TSB). The TSB thresholds are increasing by $100,000 for 2025-26 and are shown in the table below:

TSB @ 30 June 2025

NCC cap in 2025-26

Less than $1.76 million

$360,000 over three years

$1.76 million to less than $1.88 million

$240,000 over two years

$1.88 million to less than $2 million

$120,000 annual cap
(Bring forward not available)

$2 million or more

Nil NCC cap

 


Further help

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    Important information

    This information is provided by Macquarie Investment Management Limited ABN 66 002 867 003 AFSL 237 492 (MIML or We). MIML is not an authorised deposit-taking institution for the purposes of the Banking Act (Cth) 1959, and MIML’s obligations do not represent deposits or other liabilities of Macquarie Bank Limited ABN 46 008 583 542 AFSL 237502. Any investments are subject to investment risk including possible delays in repayment and loss of income and principal invested. Macquarie Bank Limited does not guarantee or otherwise provide assurance in respect of the obligations of MIML.

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