Salary sacrifice into super: how it works
Divert pre-tax salary into super, taxed at 15% instead of your marginal rate. The caps, benefits and catches.
Last updated 3 November 2026
Salary sacrificing into super is one of the simplest ways for an employee to pay less tax and build retirement savings at the same time. The idea: redirect some pre-tax salary into super, where it’s taxed at just 15% instead of your normal marginal rate. Here’s how it works and who it suits.
How it works
You arrange with your employer to pay part of your salary into super before tax, rather than into your bank account. Because it never hits your taxable income, you don’t pay your marginal rate on it — instead the super fund taxes it at a flat 15% on the way in.
If your marginal rate is 30% (plus 2% Medicare), sacrificing $1,000 means it’s taxed at 15% ($150) inside super instead of 32% ($320) in your hand — an immediate $170 saving on that $1,000, with the full $850 working for your retirement.
The contributions cap
Salary-sacrificed super counts as a concessional (before-tax) contribution, which has an annual cap:
- $30,000 in 2025–26
- $32,500 in 2026–27
Crucially, that cap includes your employer’s compulsory 12% super guarantee. So your salary sacrifice fits in the room between the SG and the cap. On a $90,000 salary, the employer pays about $10,800 SG, leaving roughly $19,200 of concessional room in 2025–26.
Who benefits most
The saving is the gap between your marginal rate and the 15% contributions tax. So it helps anyone earning above about $45,000 (where the marginal rate is 30%+). The higher your income, the bigger the benefit — up to very high earners (over $250,000), who pay 30% on contributions under Division 293, still below their top marginal rate.
The catches
- It’s locked away until you can access super — generally age 60 and retired.
- Going over the cap triggers extra tax. Unused cap from recent years can sometimes be carried forward if your total super balance is under $500,000.
- It reduces your take-home pay now, so only sacrifice what you can spare.
See the effect
Our salary calculator shows how pre-tax contributions change your take-home pay, and the superannuation calculator projects how extra contributions grow over time.
This is general information, not financial advice. Caps, Division 293 and carry-forward rules are set by the ATO and depend on your circumstances — get advice before setting up salary sacrifice.
Work out your own numbers
Frequently asked questions
What is salary sacrifice into super?
It's an arrangement where you ask your employer to pay some of your pre-tax salary into your super fund instead of your bank account. That money is taxed at 15% going into super rather than at your marginal income tax rate, which can be a substantial saving.
How much can I salary sacrifice into super?
Salary-sacrificed amounts count towards the concessional (before-tax) contributions cap, which is $30,000 in 2025-26 and $32,500 in 2026-27. That cap includes your employer's compulsory super guarantee, so your salary sacrifice is on top of what the employer already pays, up to the cap.
Who benefits most from salary sacrificing to super?
Anyone whose marginal tax rate is above 15% — which is most people earning over $45,000. The bigger the gap between your marginal rate and the 15% contributions tax, the more you save. Very high earners (over $250,000) pay 30% on contributions under Division 293, but that's still below the top marginal rate.
What's the catch with salary sacrificing super?
The money is locked away until you can access super (generally age 60 and retired). Going over the concessional cap means extra tax, though unused cap from recent years can sometimes be carried forward if your total super balance is under $500,000. It also slightly reduces your take-home pay now.