Super tips for the self-employed

If you're running your own business, there could be some tax concessions if you're proactive about growing your retirement savings through super.

If you are self-employed or a partner in a partnership, you won't get Super Guarantee (SG) contributions from an employer. This means you're responsible for making sure your super balance grows.

While it's easy to forget your super when you're self-employed – research from the Association of Superannuation Funds of Australia (ASFA) shows that around 23% of self-employed Australians have no super at all[1]

Here are some ways you can make the most of the tax breaks on offer.

1.       Claim a tax deduction

You may be able to claim a tax deduction on your personal super contributions and they'll generally be taxed at just 15% in your super fund.   Keep in mind that there are some eligibility requirements to satisfy before you can claim a tax deduction.  There are also limits to the amount you can contribute to super during a financial year before additional tax applies.

2.       Receive bonus contributions

If you estimate that you'll earn less than $50,454 for the 2015-16 financial year, it might pay to think about making voluntary after-tax contributions, as you could qualify for a co-contribution from the Government. If you earn $35,454 or less during the 2015-16 financial year and make an after-tax contribution of $1,000, the maximum contribution of $500 applies.


3.       Minimise your tax liability and maximise super when you sell your business assets

If you're a small business owner who will be selling eligible business assets (for example, at retirement), you may be able to access generous tax concessions to help reduce or eliminate Capital Gains Tax.  There are special concessions for contributing the proceeds from the sale of your eligible small business sale proceeds to your super – these proceeds don't count towards your normal contributions caps.

If you would like to know more about super for the self employed, please call our office on 08 8322 5088.


This document has been prepared by Colonial First State Investments Limited ABN 98 002 348 352, AFS Licence 232468 (Colonial First State) based on its understanding of current regulatory requirements and laws as at 3 June 2015. While all care has been taken in the preparation of this document (using sources believed to be reliable and accurate), to the maximum extent permitted by law, no person including Colonial First State or any member of the Commonwealth Bank group of companies, accepts responsibility for any loss suffered by any person arising from reliance on this information.

This document does not take into account any person's individual objectives, financial situation or needs. You should read the relevant Product Disclosure Statement (PDS) before making any recommendations to a client. Clients should read the PDS before making an investment decision and consider talking to a financial adviser.

[1] Association of Superannuation Funds of Australia (ASFA), An update on the distribution and level of retirement savings. March 2014.

[2] *All figures apply to the 2015-16 tax year unless otherwise specified.