Concessional super contributions are normally taxed at 15% inside your fund instead of your marginal rate: that's the concession. Division 293 claws half of it back from high earners: once your income plus concessional contributions for a year exceed $250,000, an extra 15% tax applies to the affected contributions, taking them from 15% to an effective 30%. The threshold is not indexed, so each year of wage growth drags more people into it.
The calculation: 15% of the lesser of two amounts
Division 293 tax is 15% of the lesser of:
- your concessional contributions for the year (the "Division 293 super contributions"), or
- the amount by which your combined income and contributions exceed $250,000.
The "lesser of" matters because it means the tax phases in. Just over the threshold, only the sliver above $250,000 is taxed; once your income alone clears the threshold, all of your concessional contributions are.
Worked example 1, just over the line (ATO's own example)
Jan has Division 293 income of $240,000 and concessional contributions of $15,000, $255,000 combined. The excess over the threshold is $5,000; her contributions are $15,000. The lesser is $5,000, so Jan's Division 293 tax is $750 (15% of $5,000).
Worked example 2, salary alone under, combined over
On a $230,000 salary with only employer super (12% = $27,600), combined income and contributions are $257,600. The excess over the threshold ($7,600) is less than the contributions ($27,600), so the tax is 15% of $7,600 = $1,140.
What counts as Division 293 income
The income side uses the same income test as the Medicare levy surcharge, disregarding reportable super contributions (they're already counted on the contributions side). It adds up:
- taxable income (assessable income minus deductions)
- total reportable fringe benefits amounts
- net financial investment loss and net rental property loss (losses are added back, negative gearing doesn't reduce Division 293 income)
- net amounts on which family trust distribution tax has been paid
minus super lump sum taxed elements taxed at a zero rate and assessable First Home Super Saver released amounts. Because taxable income includes capital gains, termination payments and back pay, a one-off event can push you over $250,000 for a single year: Division 293 is assessed year by year, and the ATO has no discretion to disregard contributions from the calculation.
What counts as Division 293 contributions
All concessional contributions: employer super guarantee, salary sacrifice, and personal contributions you claim a deduction for. For FY 2026–27 the concessional cap is $32,500. Two wrinkles:
- Excess concessional contributions are excluded, amounts over the cap are taxed under their own rules instead, so they don't get hit twice.
- Carry-forward contributions all count. If you've used unused cap from previous years to contribute above the standard cap, the whole amount within your higher personal cap is counted for Division 293. A big catch-up contribution in a high-income year can create a substantial Division 293 bill, see our concessional cap guide for how carry-forward works.
How you're assessed and how you pay
There's nothing to tick on your tax return. The ATO waits for two inputs: your lodged return and your fund's contribution reporting, then issues an Additional tax on concessional contributions (Division 293) notice. If you lodge through myTax it lands in your myGov inbox, which is why the bill often arrives weeks after your assessment and surprises people. If a second fund reports late, the assessment can be amended afterwards.
You then have two ways to pay:
- Your own money, by the due date on the notice.
- Release from super: within 60 days of the assessment you can elect to have the amount released from a super fund and paid to the ATO. The election can't be withdrawn, and it doesn't move the payment due date, pay by the due date regardless to avoid interest.
Is salary sacrificing still worth it above $250,000?
Usually yes, just less so. At incomes above $250,000 your marginal rate is 45% plus the 2% Medicare levy; contributions caught by Division 293 are taxed at 30% total. That's still a 17-point saving on every sacrificed dollar, half the concession, not none of it. Run your own numbers in the salary sacrifice calculator, which flags Division 293 exposure automatically.
Frequently asked questions
Is the $250,000 threshold indexed?
No. It has been $250,000 since 1 July 2017 and does not index, so wage growth pulls more people over it each year. It is assessed per financial year, on that year’s income and contributions.
Does salary sacrificing more super help avoid Division 293?
No, salary sacrifice contributions are concessional contributions, so they count on the contributions side of the calculation, and Division 293 income is calculated disregarding reportable super contributions, so sacrificing doesn’t reduce the income side either. Sacrificing can still be worthwhile at this income level (30% beats 47%), but it can’t sacrifice you under the threshold.
Sources
Figures on this page come from the following primary sources. The date is when we last checked the page against the source.
- Division 293 tax on concessional contributions by high-income earners (ATO), checked 25 August 2026.
- Concessional contributions cap (ATO), checked 6 August 2026.
Related
Salary sacrifice calculator: your marginal-rate saving, cap headroom and Division 293 exposure in one pass. Concessional contributions cap: the $32,500 cap and carry-forward rules. Tax brackets 2026-27: where the 45% rate starts.
Figures current as at 25 August 2026. Figures verified against the ATO's Division 293 guidance (page dated 24 August 2026); see our methodology. General information only, not financial advice.