Carry-Forward Concessional Contributions: The Catch-Up Rule Explained

🔄 What the carry-forward rule is🔗

🎯 The essential: Unused concessional cap space from the past five years rolls forward automatically, oldest first, and expires if you don't use it within that window.

Concessional contributions are before-tax contributions to your super. They include employer contributions (the Super Guarantee, currently 12% of your ordinary earnings), contributions you arrange via salary sacrifice, and personal contributions you claim as a tax deduction. They're taxed at a concessional rate of just 15% inside your super fund, rather than your marginal tax rate, which could be 32.5%, 37% or even 45%.

The annual concessional contributions cap for 2026-27 is $32,500. Contribute more than that in a single year and you'll generally pay extra tax on the excess. But if you've got unused cap space from previous years, you may be able to go well above that limit, legally.

That's the carry-forward rule (sometimes called the catch-up rule). Here's the core mechanic:

• Each year, if your concessional contributions fall short of the annual cap, the unused portion accumulates.
• You can draw on that accumulated space in a future year to make a larger concessional contribution.
• The oldest unused cap is applied first, the ATO uses a first-in, first-out approach.
• Unused amounts expire after five years. If you don't use the space within five years of it accumulating, it's gone.

The rule has been available since 1 July 2018, so the earliest year that can feed into your 2026-27 carry-forward pool is 2021-22. There's no form to fill in, you just make the contribution, and the ATO applies carry-forward automatically when you exceed the annual cap, provided you're eligible.

🚪 Who can use it: the $500,000 rule🔗

Your TSB is the combined value of all your super accounts, accumulation and pension phase, plus any rollovers in transit between funds at that date.

The rule is designed for people who've had interrupted super contributions, those who took time off to raise kids, worked part-time for a stretch, studied, or dealt with illness. It's also useful for anyone who simply had lower income in earlier years and couldn't afford to top up their super.

If your TSB goes above $500,000 at 30 June, you lose access to carry-forward for that year. But if it drops back below $500,000 at a future 30 June, you become eligible again.

🧮 How much carry-forward space could you have🔗

The table below shows the annual concessional cap for each of the five years that feed into the 2026-27 carry-forward pool. If you made zero concessional contributions in any of these years, the full cap amount is available to carry forward.

Important: the 2021-22 unused cap expires at 30 June 2027. If you haven't used it by then, it's gone, so this year is your last chance to access it.

To work out your actual available carry-forward space, log in to myGov, link to the ATO, then go to Super, Information, Carry forward concessional contributions. Your personalised figure is right there.

👩 Worked example: Sarah's catch-up contribution🔗

Sarah is 42. For five years she worked part-time on a $60,000 salary, so her employer's Super Guarantee contributions (at 11% for those years, now 12%) were roughly $6,600 per year. She made no extra contributions. Her TSB at 30 June 2026 is $185,000, well under the $500,000 threshold.

Here's her accumulated carry-forward space heading into 2026-27:

In 2026-27, Sarah returns to full-time work on a $120,000 salary. Her employer will contribute around $14,400 in SG contributions. She decides to make a personal deductible contribution of $80,000 on top of that.

Her total concessional contributions for the year: $14,400 + $80,000 = $94,400. That's $61,900 above the standard $32,500 cap, but she has $109,500 in carry-forward space available, so she's well within her limit.

Sarah's marginal tax rate is 32.5% (plus 2% Medicare levy, a 34.5% effective rate on income in that bracket). Her $80,000 personal contribution is taxed at 15% inside super instead of 34.5% on her income:

Tax rates vary by income. Higher earners may also pay Division 293 tax, an additional 15% on concessional contributions above $250,000 in income, so this example is illustrative and your own situation will differ.

🛠️ How to actually use it🔗

Step 1: check your available carry-forward balance. Log in to myGov, ATO online services, Super, Information, Carry forward concessional contributions. This shows your unused cap amounts year by year and confirms whether you're eligible based on your TSB.

Step 2: make the contribution. You have two main options: arrange salary sacrifice with your employer to redirect pre-tax salary directly into your super fund, or make a personal deductible contribution by transferring money from your bank account into your fund and claiming a tax deduction in your tax return. Both count as concessional contributions, and both trigger the carry-forward rule automatically if you exceed the standard cap.

Step 3: lodge a Notice of Intent (for personal deductible contributions). If you're making a personal contribution and want to claim a tax deduction, you must lodge a Notice of Intent to Claim or Vary a Deduction for Personal Super Contributions with your super fund before you lodge your tax return (or before you withdraw or roll over the funds, whichever comes first). Your fund will confirm receipt, then you claim the deduction in your tax return.

Step 4: let the ATO do its thing. You don't need to notify the ATO or your super fund about carry-forward. Once your contributions exceed the annual cap, the ATO automatically applies your unused cap amounts from prior years, oldest first, when it processes your tax return.

If you're also making after-tax (non-concessional) contributions, it's worth checking whether you're eligible for the super co-contribution, a free government top-up of up to $500 for lower-to-middle income earners. It's a separate scheme to carry-forward, but the two can work well together.

❓ Frequently asked questions🔗