As a stay at home mum, I think there are two aspects
of super I specifically need to be aware of: Spouse
contributions and the Government Co-contribution
A lot of us mums at home with the kids will have superannuation
funds from previous jobs. If we are not working, nothing
is being added to these investments as there is no employer
contribution. (apart from, hopefully, earnings!)
However, it is possible for your husband or partner
to make a contribution to your super fund as a 'spouse'
Why make a Spouse Contribution to Super?
If you continue to build your spouse's superannuation
fund as well as the main income earner's, this will
ensure that your retirement income is from two sources.
This may be beneficial from a tax perspective. You
If you choose not to take an income from your super
fund, but instead withdraw the benefits as a lump sum
in retirement, you will be able to access two tax-free
thresholds, which in effect allows you access to a larger
tax free super lump sum
Spouse contributions can be a tax effective way to
add money to super, which is already tax favoured.
Superannuation spouse contribution
The main income earner may be eligible for a tax offset
if contributions are made on behalf of their spouse
to a complying super fund, or retirement savings account
This tax offset applies to contributions made on behalf
of non-working or low income-earning spouses, whether
married or de facto.
The main income earner maybe able to claim an 18% tax
offset on super contributions of up to $3,000 made on
behalf of the non-working or low income-earning spouse.
At the time of writing, the main income earner may
be entitled to a tax offset of up to $540 (maximum)
each financial year if:
- they did not claim a tax deduction for the contributions
- both you and your spouse were Australian residents
when the contributions were made
- at the time of making the contributions you and
your spouse were living together, and
- the sum of your (the spouse's) assessable income
and total reportable fringe benefits amounts for the
financial year was less than $13,800, and
- the contribution was made to a super fund, which
is a complying fund for the income year in which you
make the contribution.
Please see the Australian Tax Office
for all the details on Spouse
The Government aims to encourage lower income earners
to contribute to their super, by providing a Government
If you earn $28,980 or less per year, you can receive
$1.50 for every $1 you contribute to your super, up
to the maximum super co-contribution, which is $1,500
(figures are correct for August 2008. For the latest
information, please see the Australian Tax Office web
For those earning between $28,980 and $58,980, the
amount of super co-contribution paid for each dollar
of personal super contribution reduces on a sliding
So, even if you earn a minimum income for the year,
if you have savings from your partner's income, you
can contribute $1000 to your super fund and receive
an additional $1,500 from the Government.
There is no application process for the super co-contribution.
It is paid automatically to eligible people who make
a personal contribution to their super. To ensure you
receive any super co-contribution you are eligible for,
your fund must have your tax file number and your personal
super contribution must be with your fund before 30
June. The super co-contribution will be paid into your
super fund after you have lodged your income tax return.
In order to be eligible for the Government Co-contribution,
you must have some earnings for the year. This can be
minimal, but 10% or more of your income must come from
eligible employment or your own business.
For example, I could earn just $100 this year, doing
relief work form Family Day Care. As long as my total
income (i.e. any investment income plus my earnings)
is $1000 or less, I am eligible for the super co-contribution.
My partner and I therefore need to decide whether we
think it is a sensible investment for us to put up to
$1000 of our savings into my super.
Please note, you should always seek independent
advice before making any investment decisions.