You lodged your 2025-26 return. The assessment came back, and whatever it said, you dealt with it. Then a second notice turns up with the words “Additional tax on concessional contributions” at the top and a number underneath it. Nothing has gone wrong. This is Division 293 tax, and it is issued separately from your income tax assessment because the ATO cannot calculate it until your super fund has also reported.
It applies to a wider group than most people expect, for a reason that has nothing to do with how much super you have. The line that triggers it has been $250,000 since the 2017-18 income year.
What Division 293 taxes, and the word that limits it
Division 293 is an extra 15 per cent of tax on super contributions for people whose combined income and concessional contributions go past $250,000. The ATO describes it as reducing the tax concession rather than removing it, because concessional contributions are still taxed at 15 per cent inside the fund. Division 293 brings the total on the affected portion to 30 per cent.
The word that limits it is lesser. The tax is 15 per cent of either the amount you are over the threshold, or your taxable super contributions, whichever is the smaller of the two. That is why a small step over the line produces a small bill rather than a bill on the whole contribution.
The ATO’s own example makes the mechanism concrete. Jan has Division 293 income of $240,000 and Division 293 super contributions of $15,000, which is $255,000 combined. The excess over the threshold is $5,000, and her contributions are $15,000, so the tax applies to the smaller figure of $5,000. Jan pays $750.
The practical consequence is that the first year you cross the line is usually cheap. It is the years after that, when the gap widens, where the number starts to matter.
The threshold has not moved since 2017-18
The ATO’s rates table for Division 293 has two rows in total. The threshold was $300,000 from 2012-13 to 2016-17, and $250,000 for 2017-18 onwards. There is no indexation row, because there is no indexation.
Everything on the other side of the calculation has moved.
| Year | Division 293 threshold | Concessional contributions cap | Super guarantee rate |
|---|---|---|---|
| 2017-18 to 2020-21 | $250,000 | $25,000 | 9.5% |
| 2021-22 to 2023-24 | $250,000 | $27,500 | 10% rising to 11% |
| 2024-25 | $250,000 | $30,000 | 11.5% |
| 2025-26 | $250,000 | $30,000 | 12% |
| 2026-27 | $250,000 | $32,500 | 12% |
Run the compulsory contributions on their own. At a super guarantee rate of 12 per cent, qualifying earnings of about $223,200 produce roughly $26,800 of super guarantee, and the two together reach $250,000. No salary sacrifice, no personal deductible contribution, no bonus. That figure is our arithmetic on the ATO’s 12 per cent rate rather than an ATO threshold, and it ignores deductions that reduce taxable income, but it shows where the line now sits for a salaried employee.
One more change from 1 July 2026 is worth knowing if you are well above that. The maximum contribution base, which is the point at which your employer can stop paying super guarantee for the year, became an annual figure instead of a quarterly one. For 2026-27 it is $270,830, calculated as the concessional cap of $32,500 divided by the 12 per cent charge percentage and rounded down.
Division 293 income is not your salary
The income half of the test uses the same calculation as the Medicare levy surcharge, with reportable superannuation contributions left out because contributions are counted separately. The components the ATO lists are:
- taxable income, being assessable income less allowable deductions
- total reportable fringe benefits amounts
- net financial investment loss
- net rental property loss
- the net amount on which family trust distribution tax has been paid
- super lump sum taxed elements with a zero tax rate, which are subtracted
- assessable first home super saver released amount, which is also subtracted
Two of those catch people out in opposite directions. A negatively geared property adds the rental loss back, so the deduction that lowered your taxable income does not lower your Division 293 income. Salary packaging adds back whatever reportable fringe benefits amount appears on your income statement. Someone whose tax return shows $215,000 of taxable income can be over the line once a rental loss and a reportable fringe benefits amount are added back and super guarantee is counted on top.
The year you sell something
The ATO lists four situations where Division 293 applies for a single year to someone who is not normally near the threshold: an eligible termination payment, back payment of salary or wages, a capital gain, or an income increase for another reason.
For business owners in Melbourne and Brisbane, the capital gain line is the one that turns up most. Sell an investment property, sell the business, realise a large parcel of shares, and the net capital gain lands in taxable income for that year. The super contributions that were unremarkable in every other year are now sitting on top of a much bigger income figure.
A redundancy year does the same thing. So does a year where several years of back pay are settled at once.
Using carried-forward cap can move you across the line
This is the part that is worth reading twice, because the strategy and the tax point in opposite directions.
If your total super balance was under $500,000 at 30 June of the previous year, you can use unused concessional cap from up to five earlier years. A common use of that rule is a year with a capital gain: bring forward several years of unused cap, make a large deductible personal contribution, and reduce the tax on the gain.
The ATO’s note on Division 293 says that where your concessional cap has increased because of carried-forward amounts, all contributions included in that higher cap are counted for Division 293 purposes. There is no carve-out for the carried-forward portion.
So in that year you have a larger income from the gain and a larger contributions figure from the catch-up, and both sides of the Division 293 test rise at the same time. The contribution still does its job against your income tax. It also makes the Division 293 assessment bigger. Both of those things are true, and only one of them usually gets modelled before the contribution is made.
💡 The five-year carry-forward rule and Division 293 are designed around different questions. Nothing stops them applying to the same contribution in the same year.
When the notice actually arrives
The ATO issues the Division 293 notice once it holds both your income tax return and the contribution information from your fund. That second half is why the notice lags your assessment, and why the lag varies.
| Step | Timing |
|---|---|
| Income year ends | 30 June |
| Fund reports a contribution event | Within 10 business days of the event or allocation, through MATS |
| Fund reports the 30 June annual amounts | No later than 31 October following the end of that financial year |
| You lodge your return | 31 October if self-lodging, later dates through a registered agent |
| Division 293 notice issues | After the ATO has both halves |
| Payment due | The due date printed on the notice |
| Election to release money from super | Up to 60 days from the date of the assessment |
If you hold more than one fund and one of them reports after you lodged, the ATO can issue an amended Division 293 assessment. A second notice for the same year is not necessarily an error.
The 60 days is not an extension of the due date
You can pay Division 293 tax with your own money, or by releasing money from super. Choosing the second route means completing an election form, and you have up to 60 days from the date of the assessment to make it.
The ATO states plainly what that 60 days is for. It gives you additional time to decide about releasing money from super. It does not change the due date for payment. Even where you are electing to release, the liability should still be paid by the due date on the notice of assessment, and paying by that date is how you avoid interest.
Two further points about the election. It cannot be withdrawn or reversed once made. And when the released money arrives, it pays the Division 293 liability first, then any other tax and Australian Government debts, with only the balance refunded to you.
Where the notice is sent
If you lodged through myTax, the Division 293 notice goes to your myGov inbox. If you want it to go to your tax agent instead, the agent has to update your communication preferences. That is a setting, and nobody changes it for you.
It is the same trap that sits behind the assessments for the new tax on large super balances, and it produces the same outcome: a notice with a payment date on it, sitting unread in an inbox nobody checks.
There is no discretion here
With excess concessional contributions, you can ask the ATO to disregard or reallocate amounts in special circumstances. Division 293 does not work that way. The ATO states it has no discretion to disregard or reallocate contributions for the Division 293 calculation.
There is a further consequence that is easy to miss. If you apply successfully to have excess concessional contributions disregarded or reallocated to another year, those contributions keep their concessional treatment, and they are added back into the Division 293 calculation.
What you can do is check the assessment. The ATO says an incorrect Division 293 assessment is usually caused by a mistake in the tax return or in the amounts the fund reported. Fix the source and the Division 293 tax updates. If you still disagree after that, there is an objection path.
Division 293 is not Division 296
Two super taxes with similar names now run at the same time, and they are not related.
| Division 293 | Division 296 | |
|---|---|---|
| What is measured | Income plus concessional contributions for the year | Total super balance |
| Threshold | $250,000 | $3 million for the first tier |
| Rate | An extra 15% | An extra 15%, with a further 10% above the second tier |
| In force | Since 2012-13, at $250,000 since 2017-18 | 2026-27 is the first income year it applies to |
| First notices | Already issuing each year | Not until after 30 June 2027 |
You can be liable for one, both, or neither. A high earner in their forties with $400,000 in super pays Division 293 and will not go near Division 296 for decades. A retired member with $3.5 million in a fund and no salary is the reverse. We covered Division 296 and the 30 June 2026 valuation evidence it depends on here, in Chinese.
If you paid it while on a temporary visa
This one is rarely mentioned and it matters to a lot of people who have already left Australia.
A former temporary resident may be entitled to a refund of Division 293 tax paid, where they received a departing Australia superannuation payment and apply in the approved form. The form is Division 293 Tax – refund or debt release application for former temporary residents (NAT 74727), and the ATO asks for evidence that the DASP was made, such as the payment summary from the fund.
The refund is the sum of payments made towards Division 293 assessments while you were a temporary resident. Payments made in an income year after you became a permanent resident are not refunded.
If you are working through a departure and the super side of it, our guide to claiming super when you leave Australia covers the DASP rates and the sequence.
Frequently asked questions
What is the Division 293 threshold for 2026-27?
$250,000. The ATO’s rates table shows $250,000 applying from 2017-18 onwards, and $300,000 for 2012-13 to 2016-17. The threshold is not indexed, so it is the same figure in 2026-27 as it was nine income years ago.
Is Division 293 tax 15 per cent of all my super contributions?
No. It is 15 per cent of the lesser of two amounts: how far your combined Division 293 income and contributions exceed $250,000, or your taxable super contributions. In the ATO’s example, someone $5,000 over the threshold with $15,000 of contributions pays 15 per cent of $5,000, which is $750.
Why did my Division 293 notice arrive months after my tax assessment?
Because it needs two inputs. The ATO issues it once it has both your income tax return and the contribution information reported by your super fund. Funds report contribution events within 10 business days, and report the 30 June annual amounts no later than 31 October following the end of the financial year. If a second fund reports after you lodged, you may receive an amended Division 293 assessment.
Do I have 60 days to pay Division 293 tax?
No. The 60 days is the window to lodge an election to release money from super to pay it. The ATO states the 60-day period does not change the due date for payment, and that the liability should still be paid by the due date on the notice of assessment even if you are electing to release. Paying by that date is how you avoid interest.
Can using carried-forward concessional cap trigger Division 293?
It can contribute to it. Where your concessional cap has increased through carried-forward unused amounts, the ATO counts all contributions included in the higher cap for Division 293 purposes. A catch-up contribution made in the year of a capital gain raises both the income side and the contributions side of the test at once.
I left Australia on a temporary visa and paid Division 293. Can I get it back?
Possibly. A former temporary resident may be entitled to a refund of Division 293 tax paid, where they received a departing Australia superannuation payment and apply in the approved form, NAT 74727, with evidence of the DASP. The refund covers payments made while you were a temporary resident, and not payments made in a year after you became a permanent resident.
Talk it through
Send us the year you are worried about and three things: your taxable income for that year, your total concessional contributions across every fund, and whether the year included a property sale, a business sale, a redundancy or a catch-up contribution. We will tell you whether Division 293 is likely, roughly what size it is, and when the notice should appear.
👉 Book a 20 minute call, or phone us: Melbourne 03 9600 0803 | Brisbane 07 3188 8081.
Division 293 sits across two pieces of work that are often done by different people: the income tax return and the super contribution strategy. At Wiselink both are in the same practice, split by function with senior review on the work that carries risk, which is how a catch-up contribution gets modelled against the Division 293 line before it is made rather than after the notice arrives. If the broader question is whether anyone is looking at the year ahead rather than only reporting the one behind, the planning versus compliance check sets out what to look for.
Credentials: CPA, Registered Tax Agent, ASIC Registered Agent, NTAA member, Xero, MYOB and QuickBooks partner, in practice since 2013. Our registration can be checked on the TPB public register. We work in English and Mandarin.
📍 Melbourne Camberwell (1381 Toorak Rd, Camberwell VIC 3124) · Brisbane Eight Mile Plains (3 Clunies Ross Court, Eight Mile Plains QLD 4113)
Sources
- ATO, Division 293 tax on concessional contributions by high-income earners (QC36272), last updated 24 August 2026.
- ATO, Division 293 tax, key superannuation rates and thresholds, last updated 7 August 2026.
- ATO, Concessional contributions cap, last updated 2 July 2026.
- ATO, Super guarantee, key superannuation rates and thresholds, last updated 17 April 2026.
- ATO, Reporting and lodgment, APRA fund reporting and administration.
- ATO, Annual obligations and balance amounts, fund reporting protocols, last updated 14 May 2026.
All figures retrieved 19 September 2026. The figure of about $223,200 of qualifying earnings is our arithmetic on the ATO’s 12 per cent super guarantee rate and is labelled as such in the text. This article is general information and does not take your circumstances into account. Decisions about whether to make, reduce or release contributions involve financial product advice, which is the work of a licensed financial adviser.
Reviewed by Lily Zhang, CPA and registered tax agent, founder of Wiselink Accountants. Wiselink has worked with small businesses and individual taxpayers in Melbourne and Brisbane, in English and Chinese, since 2013.
