A Self-Managed Super Fund (SMSF) is an option for retirement savings, allowing people to decide how to manage their super investments. SMSF setup gives its members the flexibility to directly take care of their retirement savings, decide on investments and customise the fund according to their own priorities. Still, managing your own fund means you must understand the rules around your contributions, tax breaks and pension choices.
SMSF trustees and members should monitor changes in rules and caps to ensure they can minimise fines and make the most of their SMSF super fund. Several updates in the next financial year can alter how much you invest in, tax your earnings and allow you to adjust retirement schemes in your self-managed super fund.
Knowing about these changes will give you the knowledge to manage your fund, make informed choices on your investments and save taxes for a long time. This guide explains the SMSF contribution limits, how to use the bring-forward rules and some important tips to help you comply with regulations and use your superannuation wisely in the year ahead.
What is a Self-Managed Super Fund (SMSF)?
Managed by the ATO, an SMSF is a private superannuation fund for up to four members who also usually act as its trustees. With this structure, members handle decision-making and running their money themselves; unlike in public or industry super funds where someone else passes on the decision.
The following are benefits of an SMSF offers:
Flexible options: An SMSF gives you the choice to invest in property, collectibles and managed funds, in addition to other assets.
Investment decisions: People can select the way their funds are handled so they align with their risk level and retirement objectives.
Price advantage: Higher investments in SMSFs can be cheaper than fees paid for retail SMSF super funds.
Estate planning: SMSFs include flexible ways to distribute wealth upon death to named beneficiaries.
Even so, managing an SMSF means you must follow superannuation guidelines, report on time and regularly handle fund administration.
If setting up a self-managed superannuation fund appeals to you, you will need to understand the setup steps, including writing the trust deed, selecting trustees, choosing where your money will be invested and registering with the ATO.
If you are prepared to control your retirement savings, SMSF Outsourcing Services can help you set up your self-funded super fund in compliance with the laws. We help you understand your SMSF so you can confidently make decisions and manage it from the beginning.
Important Updates to SMSF Contributions for 2025–26
Knowing the limits for contributions helps an SMSF trustee avoid tax on their extra contributions.
Concessional Contribution Caps
The concessional contributions cap limits the total amount of before-tax contributions you can make in your SMSF. This includes:
- As of 1 July 2025, employers will provide Super Guarantee contributions, now at 12%.
- Arranging your salary to be paid directly towards your benefits.
- The amount you can deduct because of personal contributions.
Anyone aged under 75 during the 2025–26 year can still claim the concessional contributions cap of $30,000. If you are 75 or older, you can give away up to $10,000 per year.
If your TSB as of June 30, 2024, is less than $500,000, you may use these unused cap amounts for concessional contributions in 2025–26. As a result, people can invest more in one year without crossing the maximum limits.
Example Chart: Carry-Forward Concessional Cap Usage
| Year | Annual Cap | Amount Contributed | Unused Amount Carried Forward |
| 2020–21 | $27,500 | $20,000 | $7,500 |
| 2021–22 | $27,500 | $25,000 | $2,500 |
| 2022–23 | $27,500 | $30,000 | $0 |
| 2023–24 | $30,000 | $15,000 | $15,000 |
| Total available in 2025–26 | $30,000 + carried forward $25,000 | — | — |
Non-Concessional Contributions Cap
After-tax or non-concessional contributions are money that you place into your SMSF from your funds. For the 2025–26 period, the annual limit on NCC remains the same at $120,000.
Using the bring-forward rule, people aged under 75 are allowed to contribute up to $360,000 over three years, if their total super balance stays below certain limits when starting to use the option.
Total Super Balance (TSB) Thresholds and Bring-Forward Periods:
| Total Super Balance on 30 June 2025 | Max NCC Allowed | Bring-Forward Period |
| Less than $1.76 million | $360,000 | 3 years |
| $1.76 million – less than $1.88 million | $240,000 | 2 years |
| $1.88 million – less than $2.0 million | $120,000 | 1 year (standard) |
| $2.0 million or more | $0 | Not eligible |
If your TSB is $2 million or higher, you are not allowed to make non-concessional contributions.
Be aware that near the end of the year, you may have to contribute the much as you can to NCCs to take advantage of tax, yet always keep your total contributions within the rules. Following these rules and strategies will ensure your SMSF superannuation grows, getting you ready for retirement.
Transfer Balance Cap Increase
The Transfer Balance Cap (TBC) is an important number that indicates the most a person can move from their superannuation into the tax-free retirement stage. Because earnings within this cap are not taxed, it becomes essential for trustees of self managed super fund set up when creating their retirement money plan.
The TBC will be increased to $2 million from $1.9 million starting on 1 July 2025. As a result of this, members of SMSF can add more super into their retirement phase and may earn a bigger income that is tax-free.
For those who have consumed a part of their TBC already, proportional indexation will apply to their TBC. So, their cap will be increased using the indexation factor, instead of starting at $2 million again. As a result, those who have started their retirement phase pensions get the right and proper increase.
How Proportional Indexation Works:
| Original Cap Used | Indexation Factor (5.26%) | New Personal Cap (Example) |
| $1,000,000 | 1.0526 | $1,052,600 |
| $500,000 | 1.0526 | $526,300 |
| $1,500,000 | 1.0526 | $1,578,900 |
SMSF trustees should now use this update to carefully review their retirement phase pensions before the upcoming July 2025 rule change.
Important Tax Changes Affecting High SMSF Balances
A new tax rule is being suggested for SMSFs with very large balances. Should legislation pass, superannuation balances previously subject to SMSF’s 15% tax will undergo a big jump in taxation, with earnings on the $3 million and more bracket set at 30% from April 2025.
The goal of this proposal is to give fairness to the super system by making sure people with very large balances are taxed more. Members of self-managed super funds with balances around or more than this amount might pay higher taxes on earnings from their investments, inside their SMSF.
Trustees may minimize this impact by trying the following approaches:
- Looking at where your money is invested to help your earnings rise
- Taking out money from a pension to reduce its balance to less than the minimum
- Seeking alternative methods to limit the risk of superannuation
Being alert and active in preparation will help you reduce the effects of the possible shift.
Updated Paid Parental Leave Standards
Starting 1 July 2025, the government’s Paid Parental Leave (PPL) payments will also be subject to super contributions. Thanks to this update, your super balance should continue to grow while you are on parental leave.
Because of this, SMSF members, particularly women who sometimes do not work, can keep building their super, helping to bridge the retirement savings gap brought on by work breaks. As a result, policy attention is moving toward helping more Australians achieve a good retirement through superannuation.
Legacy Pension Exit Options
Those with lifetime, life expectancy or market-linked pensions won’t be required to switch until December 2024 if they want to exit their legacy plans and choose newer pensions.
Some options which are available:
- Opening a new account-based pension within your self-managed super fund
- Automatically sending back funds so you can keep contributing.
- Choosing to take out your super as one payment
You should check your SMSF’s trust deed, because some may need updates to allow these changes to be done properly.
Tips for Planning How to Contribute to Your SMSF
For better results with your Self-Managed Super Fund in 2025–26, follow these planning tips:
- You can use the concessional cap allowance in one year even if you contribute less earlier in your super.
- Whenever your super balance makes it possible, you can make non-concessional contributions under the bring forward rule.
- Watch your Transfer Balance Cap so you can plan your move into the tax-free retirement period well.
- Make sure to look over your investment and drawdown plans if your balances might reach over $3 million.
- Always get suggestions from professionals to confirm your strategy is compliant and works for you.
Final Thought!
SMSFs has introduced updates to contribution caps, transfer balance limits, rules for taxation and pensions starting in the 2025–26 financial year. Learning about these changes and taking steps to contribute wisely, withdraw your pension and pay your taxes properly will help you get the best from your super fund.
Being knowledgeable and accessing advice made for you will help you work through the complex issues related to SMSFs.
