What super is
Superannuation is Australia's compulsory retirement savings system. Your employer pays a percentage of your earnings into a super fund in your name, where it is invested until you retire. You generally cannot withdraw it until you reach preservation age and retire, or meet another condition of release.
The super guarantee
The minimum employers must contribute is called the super guarantee (SG). For 2026–27 it is 12%. On a $100,000 salary that is $12,000 a year, paid on top of your wages unless your contract says your pay is inclusive of super.
SG is calculated on your ordinary time earnings (called qualifying earnings from 1 July 2026) – broadly your pay for ordinary hours, including most allowances, bonuses and paid leave, but generally not overtime. From 1 July 2026, under Payday Super, employers pay contributions with each pay rather than quarterly.
Who is entitled to it
Most employees are covered regardless of how much they earn, whether they are full-time, part-time or casual. Employees under 18 must work more than 30 hours in a week to qualify. Some contractors who are paid mainly for their labour are also entitled to SG.
The upper limit
Employers do not have to pay SG on earnings above the maximum super contribution base, which is $270,830 for 2026–27. Many employers pay super on the full salary anyway, so check your contract if you earn more than this.
How super is taxed
Employer contributions are 'concessional' contributions and are generally taxed at 15% when they arrive in your fund, rather than at your marginal rate. That is why super does not appear in your income tax calculation. Annual caps apply to concessional contributions, and extra tax can apply to very high earners.