Three super figures change each year and you’d be surprised how often they get mixed up. The maximum contribution base, the concessional contributions cap, and the non-concessional contributions cap sound like variations on the same thing. They’re not, and only one of them is your problem as an employer.
The maximum contribution base is an employer obligation. It caps the earnings you pay SG on. Get it wrong and you either underpay super or pay more than you owe.
The concessional and non-concessional caps are employee limits. They cap what an individual can contribute before extra tax applies. You process what you’re asked to process, but you’re not responsible for monitoring whether someone breaches them.
The reason they get confused is that they’re mathematically linked. The maximum contribution base is derived from the concessional cap, which is why both figures move together each year.
This guide covers the 2026–27 figures for all three, what changed under Payday Super on 1 July 2026, and where each one actually lands in your payroll process.
What is the maximum contribution base?
The superannuation maximum contribution base is the upper limit of an employee’s earnings for each financial year on which you need to pay super guarantee (SG). Once your payments of qualifying earnings to an employee reach that limit, you can stop paying SG contributions for that employee for the rest of the year.
For 2026–27, the maximum contribution base is $270,830.
Once you’ve paid $270,830 of qualifying earnings to an employee in 2026–27, you don’t need to make SG contributions on any further qualifying earnings paid to them for the remainder of the financial year.
One important caveat: the maximum contribution base doesn’t affect any additional super contributions you’re required to pay under an award or enterprise agreement. Reaching the base switches off the SG obligation. It doesn’t switch off anything you owe under an industrial instrument.
How the maximum contribution base is calculated
The maximum contribution base is calculated using this formula, rounded down to the nearest $10 multiple:
Concessional contributions cap × 100 ÷ charge percentage
From 1 July 2026 the concessional contributions cap is $32,500, and the charge percentage is the SG rate, currently 12%.
$32,500 × 100 ÷ 12 = $270,830
That relationship explains why the two figures move together. The base exists so an employee with a single employer on SG alone doesn’t get pushed past the concessional cap by their employer’s compulsory contributions.
What changed on 1 July 2026
The maximum contribution base used to be a quarterly figure. It’s now annual.
This change sits alongside the Payday Super rules. The annual maximum contribution base applies to employee earnings paid from 1 July 2026. For earnings paid up to 30 June 2026, the old quarterly SG rules still apply.
If you’re looking at a pay run that straddles the changeover, the date the earnings were paid determines which rules apply, not the period the work was done in.
The practical effect is that there’s no longer a quarterly reset. An employee who would previously have crossed the base in one quarter and reset the next is now tracked cumulatively across the whole financial year. It’s one of several payroll figures that changed on 1 July 2026.
What happens when a bonus pushes someone over the base
Michael earns $225,000 in qualifying earnings a year. His employer pays monthly, on the first Monday. On 17 May 2027 he gets a $100,000 performance bonus, which takes him over the maximum contribution base partway through the payment.
Here’s how the SG works out.
Step 1: Where Michael sits before the bonus
By his 3 May pay, Michael has been paid 11 monthly payments of $18,750.
11 × $18,750 = $206,250 year to date
SG on the 3 May payment is calculated normally:
$18,750 × 12% = $2,250
Step 2: How much of the bonus attracts SG
The maximum contribution base for 2026–27 is $270,830. Michael has been paid $206,250 so far, so the gap between his year-to-date earnings and the base is:
$270,830 − $206,250 = $64,580
That $64,580 is the portion of his $100,000 bonus that still attracts SG. The remaining $35,420 doesn’t.
Step 3: SG on the bonus
$64,580 × 12% = $7,749.60
Step 4: Total SG for May
$2,250 (on base pay) + $7,749.60 (on the bonus) = $9,999.60
What happens next
Michael has now hit the base. No further SG is payable on his qualifying earnings for the rest of 2026–27, though his employer may still owe additional super under an award or enterprise agreement.
The clock resets on 1 July. Michael’s 5 July 2027 payday falls in the new financial year, so SG starts again from that pay run.
STP reporting after the maximum contribution base is reached
Reaching the base changes what you report, not whether you report.
Qualifying earnings reported in Single Touch Payroll (STP) are capped at $270,830 for the rest of the financial year. You still need to submit STP reports covering any additional super amounts paid under an award or enterprise agreement, reported under Super Liability, and amounts earned under the other relevant labels.
It’s worth checking your pay category configuration here too, since not all allowances are superable and misclassification affects the qualifying earnings figure you’re tracking against the base.
What is the concessional contributions cap?
The concessional contributions cap is the maximum amount of before-tax contributions someone can make each year without those contributions being subject to extra tax. Concessional contributions include employer contributions such as SG and salary sacrifice, and personal contributions an employee claims as a tax deduction.
Unlike the maximum contribution base, this cap belongs to the employee. You can’t see their other employment, their personal deductible contributions, or their total super balance, so you aren’t responsible for monitoring it. What you’re responsible for is paying SG correctly and processing any salary sacrifice arrangement the employee has asked for.
That said, employees do sometimes ask, so it helps to know the shape of the answer.
From 1 July 2026, the concessional contributions cap is $32,500.
|
Financial year |
Concessional cap |
|---|---|
|
2026–27 |
$32,500 |
|
2024–25 to 2025–26 |
$30,000 |
|
2021–22 to 2023–24 |
$27,500 |
|
2017–18 to 2020–21 |
$25,000 |
Carry-forward concessional contributions explained
Employees may be able to carry forward unused concessional cap amounts from previous years to increase their cap in later years, if they have a total super balance of less than $500,000 at 30 June of the previous financial year and unused concessional cap amounts from up to 5 previous years.
Carry-forward operates on a rolling basis starting from 2018–19. Unused amounts are available for 5 years and then expire, and the oldest unused amounts are used first. Unused cap amounts are applied automatically once someone exceeds the cap in any year.
What happens if an employee exceeds the concessional cap
Excess concessional contributions are included in the employee’s assessable income and taxed at their marginal rate, with a 15% tax offset to account for the tax already paid by their super fund. This can affect their PAYG instalments, their income for Medicare levy purposes, and entitlements relating to Centrelink benefits and child support.
Employees who think they’ll exceed the cap can stop or reduce voluntary contributions, delay planned personal deductible contributions, or, where they have two or more employers, apply to opt out of receiving SG from one or more of them.
SG opt-out for employees with multiple employers
An employee with multiple employers who’s likely to exceed the maximum contribution base for a financial year may apply for an SG shortfall exemption certificate. If successful, both the employee and the employer receive a copy of the certificate from the ATO.
This is worth knowing about because it arrives unannounced. If a certificate lands for one of your employees, it affects how you treat their SG for the periods it covers.
What is the non-concessional contributions cap?
The non-concessional contributions cap is the maximum amount of after-tax contributions someone can make to their super each year without those contributions being subject to extra tax. It’s set at four times the concessional cap.
For 2026–27 the non-concessional cap is $130,000.
The cap is nil for a financial year if someone’s total super balance is greater than or equal to the general transfer balance cap on 30 June of the previous year. Like the concessional cap, this one belongs to the employee. Employers have no role beyond processing after-tax deductions an employee has authorised.
Maximum contribution base and concessional cap: employer checklist
Here’s what to check before your next pay run:
- Track qualifying earnings year to date, not by quarter.
The old quarterly reset is gone for earnings paid from 1 July 2026. If your process still thinks in quarters, that needs changing. - Watch bonuses and irregular payments.
These are where employees cross the base mid-payment, and the calculation splits the payment into a portion that attracts SG and a portion that doesn’t. - Keep award and enterprise agreement obligations running.
They don’t stop when the base is reached. - Get the STP treatment right.
Capping qualifying earnings while continuing to report additional super correctly is a specific configuration, not something that happens on its own.
2026–27 is the first full year under the annual maximum contribution base, and the tracking behind it is different to what payroll teams have been doing. Getting it wrong in either direction costs you: underpay SG and you’re exposed to the super guarantee charge, overpay it and you’re eating cost you never owed.
If you’d like a second set of eyes on how your payroll is handling the change, get in touch with the Alltech Payroll team. We’ll look at how your system is tracking qualifying earnings and make sure what it produces holds up.