Superannuation FAQs

Your questions, answered with clarity and trust.

What is superannuation

What super is, how it works – and why it matters Superannuation is your money set aside for your retirement. Your super fund invests your money to help it grow over time. Generally, you can’t use your super until you retire. But the choices you make today
– like how your money is invested and how much you pay in fees – can make a big difference to your balance.

How Super Works
Most Australians receive super contributions from their employer. These go into your super account, where your fund invests them on your behalf.

Quick facts:
1. Employers must pay super for employees aged 18+ (or under 18 if working 30+ hours/week).
2. The current super rate is 12% of your ordinary earnings.
3. You can access super at age 60 (if retired) or 65 (even if still working).
4. Super is taxed at concessional rates, helping it grow faster.

What is a super fund?

Super funds invest your money to help it grow. You can usually choose your own fund. If you don’t, your employer will choose one for you. You can also choose what the money gets invested in and as Muslim we want it to be Halal. If you don’t choose, the super fund will automatically choose for you.

If you have more than one super account

If you’ve worked in different jobs, you can end up with more than one super account. Combining your super into one account can make it easier to manage and might save you money on fees and insurance costs. Before you do that though, check to make sure you won’t lose insurance that you want to keep.

You can check how many super accounts you have and combine super into one account for free through the ATO Portal.

Risk Protection through super

Most super funds offer Life, total and permanent disability (TPD) and income protection cover. The insurance pays your beneficiaries of you die and/or pays you if you’re unable to work.
You can choose whether or not to have insurance. The cost depends on the type of insurance you choose, as well as things like how much you’re insured for, your age, and occupation. Your super fund deducts the cost of insurance from your super balance.

When you can access your super early

How to access your super before retirement Super is for retirement – but in some circumstances you might not have to wait. There are some circumstances where you can access your super before retirement. This includes if you have medical expenses, are in financial hardship, or can’t work due to illness or injury. To apply to access your super before retirement, you need to apply through your super fund and/or through the Australian Taxation Office (ATO). Find out more about early release of super by:
 visiting the ATO’s Early access to super
 calling the ATO on 13 10 20
 Aboriginal and Torres Strait Islander peoples can call the ATO’s dedicated Indigenous helpline on 13 10 30 How much tax you pay on your super contributions and withdrawals depends on?
 your total super amount
 your age
 the type of contribution or withdrawal you make If you inherit someone’s super after they die, the person’s super fund pays you a super death benefit. You may have to pay tax on some of this benefit.
Because everyone’s situation is different, it’s always best to get advice about tax
matters. Contact the Australian Taxation Office (ATO) or a financial adviser.

How super contributions are taxed

Money paid into your super account by your employer is taxed at 15%. So are
salary-sacrificed contributions, also known as concessional contributions
There are some exceptions to this rule:
 If you earn $37,000 or less, the tax is paid back into your super account
through the low-income super tax offset (LISTO) .
 If your income and super contributions combined are more than $250,000,
you pay Division 293 tax, an extra 15%.
If you make contributions from your after-tax income known as non-concessional
contributions, you don't pay any contributions tax.
See the ATO website for more information about how much tax you'll pay on super
contributions.

How super investment earnings are taxed

Earnings on investments within your super fund are taxed at 15%. This includes
interest and dividends, less any tax deductions or credits.

How super withdrawals are taxed

The amount of tax you pay depends on whether you withdraw your super as:
 a super income stream, or
 a lump sum
Everyone’s financial situation is unique, especially when it comes to tax. Make an
informed decision. We recommend you get financial advice before you decide to
withdraw your super.

When someone dies

When someone dies, their super is usually paid to their beneficiary. This is called a super death benefit.
If you’re a beneficiary, the amount of tax you pay on a death benefit depends on:
 the tax-free and taxable components of the super
 whether you’re a dependent for tax purposes
 whether you take the benefit as an income stream or a lump sum
See super death benefits on the ATO website for more information.