Division 293 Tax (updated)

The Division 293 Tax is not widely discussed. In fact, most taxpayers do not even realise it exists.

The tax only affects high income earners with an adjusted taxable income of $250,000 or more (At the date of publishing this article) and who have taxable contributions made to their superfunds (e.g. employer superannuation guarantee contributions, salary sacrificing into superannuation etc).

This flowchart explains how the ATO calculates your income and tax liability for the purpose of Division 293 tax.

Some of our clients have started receiving Notice of Assessments for Division 293 tax. The NOA includes a cover letter from ATO and an authority to release funds from the taxpayer's superfund, for the purpose of paying the Div 293 tax. 

To have the tax paid from your superfund, please log into your MyGov account to nominate your superfund to make the payment.

For more information about this tax, please visit the ATO website.