Contributions a fund must not accept

The contributions your SMSF can accept are restricted by:

• the age of the member for whom the contribution is made
• whether you have a valid tax file number (TFN) for the member
• prior to 1 July 2017, a member's fund-capped contribution limit.

Each contribution must meet the first two restrictions. Contributions made prior to 1 July 2017 must also meet the fund-capped contribution limit.

In an SMSF, all members of the fund are also trustees of the fund. Members should not make personal contributions that the fund cannot accept. Contributions by third parties may be at risk of being against the requirements.

If your SMSF cannot accept the contribution of a member because of these restrictions, you must return the amount to the member or entity who contributed it.

You must return the contribution within 30 days of becoming aware that you cannot accept it. For an SMSF we consider you're aware that a contribution is in breach of the law when you become aware of the contribution itself. This would generally be on the day you receive the contribution.

We expect you to act with care, skill, diligence, and to:

• know which types of contributions breach the super laws
• have a process to work out whether a particular contribution breaches the super laws
• return non-acceptable contributions within 30 days of receiving them.

The ATO view is that the 30-day requirement obliges funds to return contributions without delay. The trustee remains obliged under SISR subregulation 7.04(4) to return the amount, even if more than 30 days has elapsed since the trustee became aware of the obligation.

Find out about

• Age restrictions on contributions
• TFN restrictions on contributions
• Fund-capped contributions

Age restrictions on contributions

There is no age restriction on your SMSF accepting mandated employer contributions. However, there are criteria which need to be met for other contributions. Your SMSF can only accept non-mandated contributions which are received on or before the day that is 28 days after the end of the month in which the member turns 75 years of age.

From 2022–23 financial year onwards, your SMSF can accept non-mandated contributions for members under 75 years and there is no requirement to meet the work test.

For the 2020–21 to 2021–22 financial years your SMSF can accept non-mandated contributions for members over 67 years of age but not over 75 years of age if they have worked at least 40 hours within 30 consecutive days in that financial year. This is known as the work test.

For the 2004–05 to 2019–20 financial years your SMSF could only accept non-mandated contributions from the members over 65 years of age but not 75 years if they met the work test

You need to be sure the following contributions can be accepted if your member is at or above the relevant age threshold for:

• non-mandated employer contributions
• personal contributions
• spouse contributions
• government co-contributions
• downsizer contributions.

From the 2019–20 financial year onwards, your SMSF can also accept voluntary contributions for an additional 12-month period from the end of the financial year in which your member last met the work test, provided your member meets the following criteria. This is known as the work test exemption. Your member cannot have relied on the exemption in a previous financial year.

Table 1: Eligibility criteria for the work test exemption

Year	Age	Total super balance
2019–20	65-74	Less than $300,000
2020–21 and 2021-22	67-74	Less than $300,000

The table below looks at age restrictions in more detail.

For your SMSF to accept a downsizer contribution the member must have reached the eligible age, there is no maximum age limit and no requirement to meet the work test.

From 1 January 2023, the eligible age to make a downsizer contribution is 55 years of age and over. From 1 July 2022, it was 60 years of age or over, and prior to this, it was 65 years of age and over.

Member meets the work test (or work test exemption)

Age	2004–05 to 2019–20	2020–21 and 2021–22	2022–23 onwards
Under 55	All contributions can be accepted, except downsizer contributions.	All contributions can be accepted, except downsizer contributions.	All contributions can be accepted, except downsizer contributions.
55 – 59 years	All contributions can be accepted, except downsizer contributions.	All contributions can be accepted, except downsizer contributions	All contributions can be accepted, including downsizer contributions after 1 January 2023.
60–64 years	All contributions can be accepted, except downsizer contributions.	All contributions can be accepted, except downsizer contributions	All contributions can be accepted
65–66 years	All contributions can be accepted	All contributions can be accepted	All contributions can be accepted
67–69 years	All contributions can be accepted	All contributions can be accepted	All contributions can be accepted
70–74 years	You can only accept: mandated employer contributions downsizer contributions personal contributions and other non-mandated contributions received, on or before 28 days after the end of the month in which the member turns 75 years old.	You can only accept: mandated employer contributions downsizer contributions personal contributions and other non-mandated contributions received, on or before 28 days after the end of the month in which the member turns 75 years old. spouse contributions	All contributions can be accepted
75 years or older	You can only accept: mandated employer contributions downsizer contributions.	You can only accept: mandated employer contributions downsizer contributions.	You can only accept: mandated employer contributions downsizer contributions

Member does not meet the work test (or satisfy the work test exemption criteria from 1 July 2019)

Age	2004–05 to 2019–20	2020–21 and 2021–22	2022–23 onwards
Under 55	All contributions can be accepted, except downsizer contributions.	All contributions can be accepted, except downsizer contributions.	All contributions can be accepted, except downsizer contributions.
55 –59 years	All contributions can be accepted, except downsizer contributions.	All contributions can be accepted, except downsizer contributions.	All contributions can be accepted, including downsizer contributions after 1 January 2023.
60–64 years	All contributions can be accepted, except downsizer contributions.	All contributions can be accepted, except downsizer contributions.	All contributions can be accepted
65–66 years	You can only accept: mandated employer contributions downsizer contributions	You can only accept: mandated employer contributions downsizer contributions voluntary contributions	All contributions can be accepted
67–69 years	You can only accept: mandated employer contributions downsizer contributions	You can only accept: mandated employer contributions downsizer contributions	All contributions can be accepted
70–74 years	You can only accept: mandated employer contributions downsizer contributions.	You can only accept: mandated employer contributions downsizer contributions	All contributions can be accepted
75 years or older	You can only accept: mandated employer contributions downsizer contributions.	You can only accept: mandated employer contributions downsizer contributions.	You can only accept: mandated employer contributions downsizer contributions.

For members who are 75 years old or older, if the contribution is made more than 28 days after the end of the month in which the member turned 75 years old, the only acceptable contributions are mandated employer contributions and downsizer contributions.

TFN restrictions on contributions

Every member of the fund needs to supply their tax file number (TFN) for super purposes.

If your member has not given you their TFN, you can only accept employer contributions. All other contributions must be returned to the contributor within 30 days unless the member gives you their TFN within that period.

If any of your members haven't supplied their TFN, their contributions will be taxed at a higher rate – see Assessable contributions.

You must ensure that you correctly report member TFNs to us every year, or we may:

• make you return contributions for the member
• tax their contributions at a higher rate.

Find out about

• Fund-capped contributions

Fund-capped contributions

The fund-capped contribution limit does not apply for any contributions made from 1 July 2017.

For fund-capped contributions made prior to 1 July 2017, there was a limit on the amount you could accept in any single contribution. A fund-capped contribution was generally the largest contribution amount your fund could accept.

The fund-capped contribution limit applied per contribution, not to the total member contributions to your fund.

If you received a contribution for your member which was more than their fund-capped contribution limit, you must return the excess amount (above the limit) to them within 30 days.

The fund-capped contribution limit, by age of member

Member's age at 1 July	Fund-capped contribution limit
Under 65 years old	Three times the non-concessional contributions cap for that financial year.
Over 65 years old	The non-concessional contributions cap for that financial year.

For example, the fund-capped contribution limits for the 2016–17 financial year were:

• $180,000 if the member was 65 years old or over on 1 July 2016
• $540,000 if the member was under 65 years old on 1 July 2016.

When you worked out the fund-capped contribution amount, you should not have included any amount:

• for which you gave an acknowledgment notice to your member after they had validly notified you that they intended to claim a personal super contribution deduction for the amount
• that your member gave you a valid election to exclude an amount from their non-concessional contributions because:        
  • they received it as a result of personal injury
  • it qualified for the small business capital gains tax (CGT) concession
• that related to a directed termination payment
• where the payment was made by us because it was government contributions such as co-contributions, low income super contributions or low income superannuation tax offset.

 

 

For more information, see:

• ATO ID 2007/225 Superannuation contributions: acceptance of fund capped contributions by a self-managed superannuation fund
• ATO ID 2008/90 Superannuation contributions: return of fund capped contributions by self-managed superannuation fund
• ATO ID 2012/79 Superannuation contributions: the operation of subregulation 7.04(3) of the Superannuation Industry (Supervision) Regulations 1994 in the context of in-specie contributions of listed shares

Find out about

• Restitution for mistake
• Reporting contributions received