Super Co-Contribution: Complete Guide to the $1000 Government Boost (2025)
Learn how the government co-contribution scheme can boost your super by up to $500. Discover eligibility requirements and how to maximize this benefit.
By Alan O'Reilly – Financial Adviser, Australia
Financial Planning with Alan
A Gentle Introduction — Because Money Doesn't Need To Feel Complicated
If you're like most Australians I speak with, you're probably trying to grow your super without feeling like you're sacrificing every nice thing in life. Interest rates hurt, groceries feel like they've doubled, childcare fees are outrageous, and somehow the weekly budget still manages to surprise us.
So when people hear that the government might actually add money into their super for free, the reaction is usually a polite eyebrow raise followed by:
"Is this real? Or is this one of those things where there's a catch buried somewhere?"
Completely fair question.
But the superannuation co-contribution is very real, and honestly, one of the simplest ways for low and middle-income earners to boost their retirement savings. It's been around for years, yet most people either haven't heard of it or assume it's too complex.
My aim with this article is to show you that it's not complex at all — and that you might be sitting on an easy win.
And while we're here, if you want to check your numbers quickly, you can plug them into my Super Co-Contribution Calculator on my website. It'll give you a personalised estimate in seconds.
What Is the Superannuation Co-Contribution?
The super co-contribution is a government scheme designed to support Australians who earn a lower or middle income. If you make a personal after-tax contribution to your super — and you meet the eligibility rules — the government may chip in up to $500.
Yes, literally contribute to your super.
No forms.
No applications.
No Centrelink queues.
No confusing tax paperwork.
You simply make the contribution, lodge your tax return, and the ATO takes care of the rest.
If your super fund has your TFN, the government automatically pays the co-contribution into your super account. It usually lands between November and January for the previous financial year.
There's something refreshing about a government scheme that doesn't require half a dozen phone calls and three certified documents, isn't there?
Why This Strategy Matters More Than It Seems
It's easy to look at $500 and think, "Nice, but not life-changing."
But here's the thing: super is a long game. What feels small now potentially has decades to quietly grow in the background.
Let's say you put in $1,000, and the government adds $500. That $1,500 might grow into $3,000… $4,000… even $5,000 by the time you retire, depending on your investment mix and returns. And that's just from one year.
Do this during a few lower-income years, and you suddenly have several thousand dollars extra in retirement — without strain.
Plus, super grows in a low-tax environment:
Investment earnings are taxed at up to 15%,
and often much less depending on franking credits, capital gains rules, and your fund's investment strategy.
So even small contributions can have a big impact over time.
You know what's interesting? Australia has some of the most generous retirement savings incentives in the world, but we're often too busy, overwhelmed, or unsure to take advantage of them. The co-contribution is one of those incentives worth a second look.
Eligibility: Who Can Actually Get the Co-Contribution?
The official rules from the ATO can feel a bit dry. Here's the simpler version of who may qualify.
To be eligible for the super co-contribution, you must:
1. Make a personal after-tax contribution
This means money from your bank account, not your employer.
It must be:
- • after-tax (non-concessional)
- • not salary sacrifice
- • not claimed as a tax deduction
2. Pass the income tests
There are two:
(a) Income threshold test
Your total income (as defined by the ATO: assessable income + reportable fringe benefits + reportable employer super contributions, reduced by any excess concessional contributions) must be below the higher threshold for that financial year.
If your income is:
- • at or below the lower threshold → you may get the full $500
- • between the thresholds → reduced amount
- • at or above the higher threshold → $0
The ATO updates these thresholds regularly. My calculator includes the current values.
(b) 10% eligible income test
At least 10% of your income must come from:
- • employment, or
- • running a business (sole trader, partnership, etc.)
If you earn all your income from investments such as rent, dividends or interest, you won't qualify.
3. Be under 71 at the end of the financial year
4. Lodge a tax return
5. Have a super balance below the transfer balance cap
For most people, this just means your balance can't be extremely high.
6. Not exceed your non-concessional contributions cap
Most people never come close to this cap, especially in lower-income years.
How Much Can You Actually Get?
Here's the simple version:
If you contribute: $1,000 after-tax → You may receive $500 (if under lower income threshold)
If you earn above the lower threshold, the co-contribution reduces gradually.
The minimum payment is $20.
You don't need to do any maths — my Co-Contribution Calculator works it out automatically.
Quick Example to Make It Real
These are based directly on the ATO rules.
Example 1 — Katie, earning $41,000
Katie earns $41,000 this year and contributes $1,000 of her after-tax income to super.
She meets the income test and the 10% eligible income test.
Her co-contribution? $500
If Katie does this for two or three years while her income is still in the lower bracket (maybe she's studying, returning from maternity leave, or just early in her career), that's $1,500 of government contributions before any investment returns.
Imagine that compounding for the next 30 years.
Example 2 — Sean, earning $54,500
Sean earns more than the lower threshold but less than the higher threshold. He contributes $1,000 after-tax.
His co-contribution is reduced according to the tapering formula.
Let's say he qualifies for $200.
Not quite $500, but free money is free money — and it still compounds over decades.
Common Misunderstandings (That I Hear All the Time)
"Do I need to apply?"
No. Zero forms. The ATO handles everything when you lodge your tax return.
"Can I salary sacrifice to get the $500?"
No — salary sacrifice is concessional, not non-concessional.
"Will the money be paid into my bank account?"
No — it goes straight into your super fund.
"Will it show up immediately?"
Unfortunately, no. Co-contributions usually land months later — often between November and January.
"What if my super fund doesn't accept it?"
This usually happens only if your fund doesn't have your TFN. Easy fix.
How to Make Your Contribution
Here's what most people do:
- Log in to your super fund portal
Most super funds have a "make a contribution" or "pay money into my super" section in their online portal or app.
- Look for "Personal Contribution" or "After-tax Contribution"
Sometimes it's listed under "BPAY details".
You'll often see:
- Biller code
- Your personal customer reference number (often your member number)
- Transfer the amount using BPAY or bank transfer
This must be from your account, not your employer.
- Keep a record or screenshot
The ATO doesn't ask for it, but it helps you track contributions and avoid going over caps.
- Make sure it clears before 30 June
Leaving it until the last evening of the financial year isn't ideal — processing can take 1–3 days.
- Lodge your tax return
This is when the ATO checks your income and contribution.
- Wait for the co-contribution
It'll pop into your fund later in the year. Don't be alarmed if nothing happens for months.
If you want a deeper visual walk-through, I have a long-form YouTube video explaining the entire strategy step-by-step — and I'll link it in Part 2.
This strategy is one of those small, elegant wins in personal finance. Very little complexity. No investment risk over and above your normal super fund choice. And no hidden traps in the rules — they're clearly set out by the ATO.
And honestly? Those lower-income years often become the years we least feel like saving — which makes this incentive even more valuable.
When the Co-Contribution Becomes a Quiet Superpower
There are certain seasons in life where this strategy really shines. And you might recognise yourself in one of these scenarios — because they're incredibly common.
1. Parental Leave Years
Whether it's mum or dad taking time off, income often drops below the usual bracket. It's a perfect moment to take advantage of the co-contribution, especially if you still want to keep your super growing a little while you're home with a newborn.
2. Casual, Part-Time, or Shift Workers
Hospitality, retail, early childhood educators, healthcare assistants, students — low and middle-income years are simply part of the journey. Even a small after-tax contribution ($20, $50, whatever is comfortable) can generate a co-contribution.
3. Anyone In-Between Jobs
Redundancy, career breaks, retraining, studying — if your income dips this year but you still want to build your retirement savings, this is a smart, government-backed boost.
4. Sole Traders or Side-Hustlers During Slow Periods
Your income might fluctuate heavily. During quieter months, you may pass the income thresholds and qualify for the co-contribution, especially since the 10% eligible income rule works in your favour as a business owner.
5. New Migrants Building Their Career in Australia
Many new Australians start on lower incomes before working their way into higher roles. During those early years, the co-contribution is often perfectly suited.
6. Anyone With a "Low Taxable Income Year" Because of Deductions
This one surprises people.
Some individuals drop below the thresholds because of: negatively geared property deductions, work-related deductions, business-related expenses, education expenses. A temporarily low taxable income can still qualify — provided the 10% eligible income rule is met.
These are the years that fly under the radar, yet they're often the perfect time to take advantage of the scheme.
When This Strategy Might Not Be Suitable
1. You're a high-income earner
If you typically earn well above the higher income threshold, you won't qualify for any co-contribution. There's no workaround here.
2. You need the cash for immediate expenses
If your budget is tight and you need liquidity, don't strain yourself. Super is a long-term structure, and money you contribute generally becomes preserved until you meet a condition of release, such as retirement.
3. You are close to your non-concessional contributions cap
This is rare, but it matters for people making large after-tax contributions. Going over can trigger tax issues.
4. You didn't earn any eligible income
If 100% of your income came from investments, the co-contribution will not apply.
5. You're over 71 at the end of the financial year
The ATO is strict on this — the co-contribution can't apply once you pass this age limit.
6. You're trying to use salary sacrifice thinking it qualifies
It doesn't. Salary sacrifice is concessional and won't trigger a co-contribution.
How the ATO Pays the Co-Contribution (The Timeline No One Tells You)
This part often confuses people because they expect the co-contribution to appear immediately.
Here's what actually happens:
- Step 1 — You make a personal after-tax contribution
Before 30 June, using BPAY or direct payment into your fund.
- Step 2 — You lodge your tax return
This is where the ATO checks your: total income, eligible income percentage, super contributions, residency, age, TFN on file, super balance from the previous 30 June, non-concessional cap position.
- Step 3 — The ATO calculates your entitlement
- Step 4 — Payment is made to your super fund
This usually occurs between November and January of the following financial year.
- Step 5 — Your super fund credits it to your account
It will show in your member statement as "Government Co-Contribution."
What if there's a delay?
It rarely needs chasing, but if something looks off, the ATO provides support through myGov or via their 13 10 20 line.
If your fund can't accept the contribution (usually due to missing TFN or fund rules), the ATO will contact you for alternative fund details.
It's a slow system, but it works.
How This Strategy Fits Into the Bigger Financial Picture
The super co-contribution is just one tool — but it fits beautifully within a broader strategy.
1. It complements the Low Income Super Tax Offset (LISTO)
LISTO can refund up to $500 in tax on your concessional (before-tax) contributions if you're a low-income earner. In the right scenario, someone could receive: up to $500 from LISTO, and up to $500 from the co-contribution. That's a potential $1,000 boost in a single year, without anything especially complex.
2. It can support First Home Super Saver Scheme users
If you're using the First Home Super Saver Scheme (FHSSS), your own voluntary contributions may be eligible to withdraw later for a first home deposit. Personal after-tax contributions that help you qualify for the co-contribution can also count towards your FHSSS limits (subject to the FHSSS rules and caps), while the co-contribution itself simply boosts your super balance in the background.
3. It contributes to long-term tax effectiveness
Super's low tax environment, combined with compounding, means every dollar that goes in earlier has more time to work for you, especially if you're still a fair way out from retirement.
4. It supports your overall financial wellbeing
Small, simple wins like this can make money feel less stressful. When you know you're using the rules in your favour, it often builds confidence and a sense of control.
And yes — this is exactly the sort of thing your future self will quietly appreciate.
Watch My Full YouTube Video (Optional Embed)
If you're someone who prefers explanations you can watch rather than read, here's my detailed breakdown on YouTube:
[Embed: Your long-form video on the government co-contribution]
It covers examples, thresholds, and step-by-step instructions for making your contribution.
FAQ — Quick Answers to Common Questions
How much do I need to contribute to get the full $500?
You need to contribute $1,000 after-tax (non-concessional) and meet the income thresholds.
Can I contribute less?
Yes — you'll receive a smaller co-contribution, but you'll still get something if you're eligible.
Can I claim a tax deduction?
No — claiming a deduction turns your contribution into a concessional contribution, which doesn't qualify.
Do I need to notify my fund?
No. Just contribute.
Does it affect my tax return?
No — the co-contribution isn't taxable and doesn't count as income.
Try My Super Co-Contribution Calculator
If you want an instant estimate based on the latest ATO thresholds, you can try my calculator here:
👉 Super Co-Contribution CalculatorIt's quick, simple, and gives you a clear picture of what you may receive.
Thinking About Your Broader Strategy?
Everyone's situation is different — income level, age, life stage, kids, stress, expenses, all of it.
If you'd like help tailoring a plan, I help people Australia-wide build clear, calm, reliable financial strategies focusing on:
- • building wealth
- • growing super
- • investing wisely
- • tax planning
- • protecting your family
- • retirement planning
No hard sell. Just clarity.
You can book a chat on my website anytime.
Other Super Strategies Worth Exploring
The co-contribution is just one of several government incentives for growing your super. If you have a spouse or partner earning under $40,000, you might also qualify for a spouse super contribution tax offset of up to $540 per year.
This works differently — you contribute to your spouse's super fund using after-tax money, and you claim the tax offset in your own tax return. It's particularly useful for couples where one partner has taken time off for caring responsibilities or is working part-time.
Explore all my free financial calculators to find strategies that suit your situation.
General Advice Warning
The information in this article is general in nature and doesn't consider your objectives, financial situation, or needs. Before acting, think about whether it's appropriate for your circumstances. You may wish to seek personal financial advice from a qualified adviser.
Final Thought — Because Small Things Add Up
The co-contribution isn't flashy.
It's not something you see in bold headlines.
But it's one of those rare opportunities where the system actually gives something back — quietly, efficiently, and without fuss.
And if you use it during the natural ups and downs of your income, it can meaningfully strengthen your retirement savings.
Your future self will be glad you paid attention to this one.
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