Following the release of the December 2024 quarter Consumer Price Index (CPI) figure, the Total Superannuation Balance (TSB), which determines an individual’s eligibility to make Non-Concessional Contributions (NCC) to superannuation, and utilise the bring-forward provisions, will increase from $1.9 million to $2 million.
A person’s TSB is determined at 30 June of each financial year and this increase will potentially allow individuals, who were previously capped-out, to now contribute more into superannuation, as follows:
The general Transfer Balance Cap (TBC) will also be indexed from $1.9 million to $2 million from 1 July 2025. The TBC introduced on 1 July 2017, limits the total amount of superannuation assets that a member can transfer to the tax-free retirement phase via an Account Based Pension. The general TBC was originally set at $1.6 million, and this will be the third time it has been indexed.
Unfortunately, this doesn’t mean that you can transfer another $100,000 into your retirement phase on 1 July 2025. An individual’s entitlement to the indexation will occur through “proportional indexation” which works in the following manner:
It is important to note that the above proportional indexation is not based on your transfer balance account at 1 July 2025 but is based on the highest ever balance recorded in your transfer balance account.
If you have any questions relating to your superannuation please get in touch with a member of our award-winning team.