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March 21, 2026 — 5:01am
The end of financial year is probably one of the furthest things from your mind right now but you should still have your eye on a lucrative June 30 prize. Because for those who play the system right, there is a potential $500 on offer – free.
The superannuation co-contribution is a government incentive to boost the super of low and middle earners, introduced more than two decades ago. It provides a 50 per cent matching contribution for after-tax payments you make, up to a ceiling of $1000.
The full 50 per cent – so, $500 – is available on incomes up to $47,488. Even all the way to earnings of $62,488 you receive a phased-down amount.
But key is that word ‘earnings’. The co-contribution scheme is designed for people who are working, unlike the spouse contribution, which is available to everyone (this is another great potential boost for families, under which a $3000 after-tax contribution on behalf of a partner making less than $40,000 a year, nets the payer as much as a $540 tax offset).
Here’s the thing, though: the possibly free $500 from the super co-contribution expires each June 30 (so, too, does the potential $540 from a spouse contribution).
But even if you took advantage of it once – at age 30 and assuming a typical 8 per cent investment return until you retired at age 67 – it would result in your super swelling by $25,798 for just a $1000 investment on your part.
Anything extra you put in up to that amount will net you a 50 per cent matching contribution from the government.
And imagine if you did that every year – it would be a game changer for your end super balance. So, this year you have no time to lose. To snare the $500, you want to get your contribution in well before June 30 to allow for processing.
But if finding a ready $1000 is a challenge right now, what about $71.50 over the next 14 weeks? Then, from July 1, if you qualify for what is an incredible guaranteed return and instant super boost, it would take reserving about $20 a pay for the (let’s call it) 51 weeks you would have to amass the next $1000 after-tax super contribution.
Consider whether making this a part of your long-term ‘look after you’ plan is appropriate. Meanwhile, know that what is called the low-income superannuation tax offset (LISTO) is being extended to more Aussies, and increased.
As part of a bill cracking down on higher earners’ super perks, eligibility will no longer cut out at $37,000 but $45,000 from July 2027 (and it will be increased in line with personal income tax thresholds).
You can simply think of LISTO as compensation for the 15 per cent super contributions tax – it’s currently $500 per year but will soon be $810.
Getting back to the super co-contribution, to qualify for the $500 in your account, you need to be under age 71 with 10 per cent or more of your total income coming from employment-related activities or carrying on a business.
Your income for the eligibility thresholds of $47,488 (for the full co-contribution) and $62,488 (where the payment cuts out) is counted as: your assessable income, reportable fringe benefits, reportable employer super contributions reduced (but not below zero) by any excess concessional contributions, minus any assessable first-home super saver released amount.
In terms of how the co-contribution is calculated, if your total income is between the two thresholds then your entitlement simply phases down as your income rises. If your co-contribution is less than $20, you will get the minimum amount of $20.
The co-contribution is paid automatically after the end of tax year – you don’t need to do anything bar find the maximum money you can to trigger it. But bottom line: anything extra you put in up to that amount will net you a 50 per cent matching contribution from the government.
It could be well worth it.
Nicole Pedersen-McKinnon is the author of How to Get Mortgage-Free Like Me, available at nicolessmartmoney.com. Follow her on Facebook, X and Instagram.
- Advice given in this article is general in nature and is not intended to influence readers’ decisions about investing or financial products. They should always seek their own professional advice that takes into account their own personal circumstances before making any financial decisions.
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