The government has provided many tax incentives to encourage people to put the money in superannuation for their retirement. One of those incentives is, by making a superannuation contribution on behalf of your spouse, you will receive a tax rebate. This incentive is called a “spouse contribution”.

One of the benefits or incentives for making a spouse contribution is that you can get a tax rebate or tax offset of up to $540 each year. A spouse contribution is a personal after-tax contribution (non-concessional contribution) you put into your eligible spouse’s superannuation fund and claim 18% of the amount contributed (up to a maximum of $3,000) as a tax rebate through your tax return (18% of $3,000 = $540). The receiving spouse must either be not working or low income earner with less than $13,800 assessable income (this includes reportable fringe benefits and reportable employer contributions).

There is no limit on the amount you can put into your spouse’s superannuation account but the maximum rebate available to you is capped $540. However, note that the spouse contributions going into your spouse’s superannuation account are classed as non-concessional contributions and subject to the non-concessional contributions cap. If your spouse exceeds the cap, he/she will have to pay excess contributions tax (see the article on “How much can you contribute to superannuation”).

Eligibility

  • To receive the maximum rebate, the receiving spouse’s assessable income must be under $10,800. If the income is greater than $13,800, the rebate is not available. Where the assessable income is between $10,800 and $13,800, the rebate is available at a sliding scale and cut-off once it reaches $13,800.
  • The receiving spouse must be under 65. If between 65 and 69, the receiving spouse must meet the work test by working at least 40 hours in a period not more than 30 consecutive days in the financial year.
  • You and your spouse must be married or living together as a de-facto couple.
  • Both you and your spouse must be Australian residents.

Examples:

1. Full rebate – you contribute $5,000 after-tax money to your spouse’s super account and your spouse’s assessable income is $10,800 or under:

18% x $3,000 = $540 full rebate

2. Partial rebate – you contribute $5,000 after-tax money to your spouse’s super account and your spouse’s assessable income is $12,000:

  • $12,000 – $10,800 = $1,200.
  • $3,000 – $1,200 = $1,800
  • 18% x $1,800 = $324 rebate

3. Partial rebate – you contribute $2,000 after-tax money to your spouse’s super account and your spouse’s assessable income is $12,500:

  • $12,500 – $10,800 = $1,700
  • $3,000 – $1,700 = $1,300 (use the lesser of result at this step and amount contributed. On this occasion, $1,300 is less than amount contributed)
  • 18% x $1,300 = $234 rebate