The ATO website on this topic, which can be found here, is imo quite confusing.
My understanding is that if your total income, including your super income, is >$300k pa then you need to pay 30% tax on all of your super contributions, excluding the non-concessional super contributions.
Consider the following examples.
- 2014/15 total income = $500k, and you make $25k super contributions. In this case you pay 30% tax on the $25k = $7,500.
- 2014/15 total income = $300k, and you make $25k super contributions. In this case you pay 15% tax on the $25k = $3,750.
Is the above approach correct?
My somewhat confused interpretation of the Division 293 tax is such that there is no pro-rata adjustment. Surely the fair method would be as described below, not that the Division 293 tax is by any stretch fair in the beginning.
- 2014/15 total income = $500k, and you make $25k super contributions.
Tax = 25k x 15% x 300/500 + 25k x 30% x 200/500 = $5,250.
