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When is a superannuation contribution made?

Section: 2.15

When a contribution is made is important as it is relevant to whether the fund is able to accept the contribution, including whether the member has satisfied the work test, and to determine the period for which the person making the contribution may be eligible to claim a tax deduction.

Taxation Ruling TR 2010/1 confirms that a contribution is made when the capital of the fund is increased and that a fund's capital will be increased when an amount is received, or ownership of an asset is obtained, or a fund otherwise obtains the benefit of an amount.

For example, a contribution of money via an electronic transfer will be made when the amount is credited to the superannuation fund's bank account - not when the client did everything necessary to effect the payment.

The following table summarises the timing of various methods of contribution.

How the contribution is made When contribution made
Electronic transfer When the funds are credited to the superannuation fund's account.
Personal cheque If the cheque is not post dated when it is received by the fund, so long as it is promptly presented and not dishonoured. Otherwise, when it is able to be presented for payment (i.e. the date on the cheque) so long as the cheque is promptly presented and not dishonoured. (Note - similar rules apply for promissory notes).
Creating a right in the name of a fund for no consideration When the superannuation fund commences to hold the right.
Increasing the value of an asset When ownership of the improvement passes to the fund. In general, the ownership would pass immediately.
Paying a fund liability or expense When a person pays a fund's liability or expense.
Forgiving a debt When the lender executes a deed of release that relieves the superannuation fund from the obligation to repay a loan.
Payment of debt by guarantor If the guarantor has no right of indemnity - when the super fund's liability is satisfied. Otherwise, when the indemnity expires, or when the guarantor takes formal steps to forgo that right by executing a deed of release.
In specie transfer of listed shares When the superannuation provider obtains a properly executed off-market share transfer in registrable form. See Taxation Ruling TR 2010/1 for more information.
In specie transfer of real property When the superannuation provider acquires the beneficial ownership of real property, which is when the fund obtains possession of a properly executed transfer that is in registrable form together with any title deeds and other documents necessary to procure registration of the superannuation provider as the legal owner of the land.

See Taxation Ruling TR 2010/1 for more information.

Last modified: Thursday, August 24, 2017