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Making member contributions from JobKeeper into your super

New rules have effectively introduced a new category of permissible super contribution during COVID.

The Australian Prudential Regulation Authority (APRA) has confirmed that a registrable superannuation entity (RSE) can accept a personal contribution from an individual aged 67 to 74 who is stood down but in receipt of the JobKeeper payments.

This means that those workers who are not employed but are receiving JobKeeper payments from their employer can still make contributions to their superannuation fund.

Oliver Wahlstrom, Maddocks Lawyers

Making super contributions generally

A 'contribution' is anything of value that increases the fund's capital and is made by a person whose purpose is to benefit one, or more, or all members of the fund. For more information regarding contributions, see this ClearLaw article.

Generally, an RSE may accept contributions made by the member. However, for members between the ages of 67 and 74 inclusive, an RSE may only do so where the member has been gainfully employed on at least a part-time basis during the financial year in which the member makes the contribution1. This is known as the 'work test'.

'Gainfully employed' means employed or self-employed for gain or reward in any business, trade, profession, vocation, calling, occupation or employment 2. A person is gainfully employed on a part-time basis during a financial year if the person was gainfully employed for at least 40 hours in a period of not more than 30 consecutive days in that financial year.3

Contributions while receiving JobKeeper payment

Where an employer is receiving the JobKeeper wage subsidy for an individual, RSE licensees should regard the individual as 'gainfully employed' for the purposes of the 'work test'. This includes the scenario where that individual has been fully stood down and is no longer performing work. It is appropriate for RSE licensees to take this approach because in APRA's view, the individual is still employed and is receiving a valuable benefit from their employer.

Because it may be difficult for an RSE to differentiate between an individual who is working and an individual who is not but receiving JobKeeper payments nonetheless, APRA has confirmed that RSE licensees need not make the distinction. Instead, they may assume that all members in receipt of the JobKeeper subsidy satisfy the 'work test' for the purpose of voluntary superannuation contributions.

This means that if you are receiving the JobKeeper payment you can continue to make contributions to your superannuation fund, regardless of whether you are working reduced hours or have been stood down.

More information from Maddocks

For more information, contact Maddocks on (03) 9258 3555 and ask to speak to a member of the Commercial team.

More Cleardocs information on related topics

You can read earlier ClearLaw articles on a range of topics, such as:

Order related document packages

  1. Superannuation Industry (Supervision) Regulations 1994 (Cth) (SIS Regulations), r 7.04.
  2. SIS Regulations, r 1.03(1).
  3. SIS Regulations, r 7.01(3).

Lawyer in Profile

Leigh Baring
Leigh Baring
PH: 61 3 9258 3673

Leigh is a partner in the Maddocks Tax & Revenue team.

Leigh regularly provides advice on:

  • structuring of businesses and transactions;
  • mergers and acquisitions;
  • corporate reorganisations and distributions;
  • sale of businesses;
  • demergers;
  • capital raisings;
  • joint ventures and property developments;
  • international tax (both inbound and outbound);
  • succession planning; and
  • liquidations.

His advice covers both direct and indirect tax considerations.

Leigh advises Australian and multinational companies, high net worth individuals, accountants and financial advisers on all areas of taxation law.