Read time: 2 min
Published Monday 27th April 2026

 

The Government has introduced new rules that increase tax on very large superannuation balances.

From 1 July 2026, individuals with total superannuation balances above $3 million may be subject to an additional tax under Division 296.

For most people, this will not apply. For those who may be affected, the focus should be on understanding how the rules operate and whether any review is required.

What has changed

An additional 15% tax now applies to the portion of superannuation earnings linked to balances above $3 million.

This sits alongside the existing tax framework inside superannuation.

The measure applies at the individual level. Your total super balance across all funds is considered, not just one account.

There is also a higher tier for balances above $10 million, which applies to a smaller group.

Why is this different

The key distinction is how “earnings” are calculated.

The new rules broadly use changes in your total super balance over the year, adjusted for contributions and withdrawals.

This means:

  • Increases in asset values may be included, even if the asset has not been sold
  • Tax outcomes may vary from year to year depending on market movements
  • The liability may arise without a corresponding cash inflow

For individuals with self-managed super funds or illiquid assets, this can create additional planning considerations.

Who needs to pay attention?

You may need to review your position if:

  • Your total superannuation balance is close to or above $3 million
  • You expect continued growth in your super balance
  • Your super includes property, business assets, or other illiquid investments

This is not a broad change. It is targeted at higher balance members.

What this does not mean

The change is often overstated.

It does not mean:

  • All superannuation is now taxed at 30%
  • Everyone with super will be affected
  • You need to make immediate structural changes

The existing concessional tax system remains in place for the majority of superannuation balances.

What to do next

At this stage, the priority is clarity, not reaction.

If you may be affected, the appropriate next step is to:

  • Confirm your total superannuation balance
  • Understand how your assets are structured within super
  • Assess potential tax and cash flow implications under the new rules

Changes should be considered in the context of your broader financial position, not in isolation.

If you would like to review how these changes apply to your superannuation position, Factor1 can assist with a structured assessment and scenario modelling.

 

Please note: For general information only. Outcomes depend on individual circumstances, superannuation structure, asset profile, and how the law applies to your position. This information is not personal financial advice.