Australian employers can now stop paying superannuation guarantee contributions once employees' earnings reach AUD 270,830 in 2026–27, up from the previous AUD 250,000 threshold—giving high-income earners payroll relief.
The Australian Taxation Office (ATO) has updated its guidance on the maximum contributions base (MCB) for superannuation guarantee contributions on 3 June 2026.
Employers are not required to pay super guarantee once an employee’s earnings exceed the MCB. The key update is an increase in the MCB from AUD 250,000 to AUD 270,830 effective 1 July 2026, reflecting the rise in the basic concessional contributions cap from AUD 30,000 to AUD 32,500.
The updated guidance also includes an additional example.
When the maximum contribution base applies
The maximum contribution base is the upper limit of your employee’s earnings for each financial year for which you need to pay super guarantee. If your payments of qualifying earnings to your employee reach the maximum contribution base, you can stop paying super guarantee contributions for the employee for that year.
How much is the maximum contribution base?
For 2026–27, the maximum contribution base is AUD 270,830.
If you have paid AUD 270,830 of qualifying earnings to an employee for the 2026–27 year, you do not need to make super guarantee contributions for that employee for any additional qualifying earnings paid to them for the remainder of the financial year.
The maximum contribution base does not affect any additional super contributions you are required to pay under an award or enterprise agreement.
How the maximum contribution base is calculated
The maximum contribution base for a financial year is calculated using the following formula (rounded down to the nearest AUD 10 multiple):
Concessional contributions cap × 100 ÷ charge percentage
The concessional contributions cap is the basic concessional contributions cap for the financial year in which the payment is made. From 1 July 2026, the concessional contributions cap is AUD 32,500.
The charge percentage is the super guarantee rate, which is currently 12%.
Therefore, the maximum contribution base for 2026–27 is:
AUD 32,500 × 100 ÷ 12 = AUD 270,830
Example: employee’s qualifying earnings exceed the maximum contribution base
Michael’s base pay includes AUD 225,000 of qualifying earnings each financial year. His employer, CompanyA, runs on a monthly pay cycle and pays Michael on the first Monday of each month.
For the 2026–27 financial year, the maximum contribution base is AUD 270,830.
On 3 May 2027, Michael receives his usual pay. On 17 May, Michael receives a performance bonus of AUD 100,000. His year-to-date (YTD) qualifying earnings are AUD 306,250, exceeding the maximum contribution base by AUD 35,420. CompanyA pays super guarantee up to the point that Michael’s qualifying earnings reach the maximum contribution base.
Working out how much super guarantee to pay
Michael’s base pay
Michael receives AUD 18,750 of his base pay on 3 May. To work out the amount of super guarantee, CompanyA multiplies this by the super guarantee rate of 12%:
Super guarantee = AUD 18,750 × 12% = AUD 2,250
At this point, CompanyA has paid him AUD 206,250 of his base pay:
AUD 18,750 × 11 payments (July 2026 to May 2027) = AUD 206,250
Michael’s bonus
Michael receives his AUD 100,000 bonus on 17 May. CompanyA pays super guarantee contributions up to the point that Michael’s qualifying earnings for the financial year reach the maximum contribution base. As the bonus takes Michael over the maximum contribution base,
CompanyA does not need to pay any super guarantee on the excess bonus, or any other qualifying earnings for the rest of the financial year.
AUD 270,830 (maximum contribution base)
− AUD 206,250 (year-to-date qualifying earnings)
= AUD 64,580 (portion of bonus that does not exceed the maximum contribution base)
Super guarantee = AUD 64,580 × 12% = AUD 7,749.60
Total super guarantee contributions for May payments
CompanyA makes a super guarantee contribution of AUD 2,250 for the qualifying earnings paid on 3 May and AUD 7,749.60 for the qualifying earnings paid on 17 May.
AUD 2,250 (super on base pay for 3 May)
+ AUD 7,749.60 (super on qualifying portion of bonus)
= AUD 9,999.60
No super guarantee on further qualifying earnings
As the maximum contribution base has been exceeded, CompanyA does not need to pay super guarantee on any further payments of qualifying earnings to Michael in the 2026–27 financial year.
CompanyA may still have to pay additional super for Michael under an award or enterprise agreement.
STP reporting
CompanyA can also stop reporting qualifying earnings for Michael in Single Touch Payroll for the rest of the financial year.
The company will still need to submit Single Touch Payroll reports for:
- any additional super amounts (for example, under an award or enterprise agreement) paid for Michael, under Super Liability
- amounts earned, under other relevant labels.
Next financial year
The following payday of 5 July 2027 is in the 2027–28 financial year. CompanyA will need to restart paying super guarantee contributions for Michael from this payday, if the company is not otherwise exempt.
Super guarantee opt out for high-income earners
An employee with multiple employers who is likely to exceed the maximum contribution base for a financial year may apply for an SG shortfall exemption certificate. If successful, you will receive a copy of the certificate from both your employee and us.
