Super Tax Offset Calculator

Choose an Income Stream or Lump Sum

Use the super tax offset calculator with the component amounts from your fund’s payment summary. For an income stream, enter the totals for all regular payments in the income year and the date of the first payment in that year. For a lump sum, enter one ordinary member withdrawal and the date you received it.

The Australian Taxation Office (ATO) distinguishes the tax-free component from the taxable component. The taxable component can contain a taxed element, on which the fund has paid tax, and an untaxed element. Enter each of the three amounts separately. The payment total is their sum. The tax-free component can still count towards the cap on a capped defined benefit pension. See the ATO’s guide to tax on super benefits.

This estimate covers Australian residents for the full income year. Enter other taxable income after deductions, excluding the payment you enter here. The estimate uses the standard resident income tax brackets. It estimates income tax before any other offsets, Medicare levy surcharge or study loan repayments. The tax on the payment can fall to zero. Any effect of a stream offset on the rest of your income sits outside this estimate. Death benefits and special releases such as terminal medical condition payments use different rules.

Income Stream Offset Conditions

From age 60, the untaxed element of your own income stream can earn a 10% tax offset. The untaxed element remains assessable income. The taxed element and tax-free component generally attract no income tax after age 60, subject to the capped defined benefit rules.

Before age 60, both taxable elements are assessable. From 2024-25, you can claim 15% of the taxed element if the fund classifies your income stream as a disability super benefit. In 2023-24 the 15% offset also applied to the taxed element after reaching preservation age and before turning 60. For the supported years, preservation age is 60 for anyone born from 1 July 1964. If you turned 60 during the year, enter the amounts the fund paid before your birthday so the tool can apply the two age rules. The Income Tax Assessment Act 1997 sets the offsets in Division 301 and the defined benefit adjustments in Division 303.

The full-year defined benefit income cap is $131,250 for 2026-27. Combine capped defined benefit streams with the same age and disability treatment. Enter the earliest first payment date within the year. The tax-free component and taxed element received from age 60 count towards the cap first. Half of any excess from those two components becomes assessable. The 10% offset applies to the untaxed element only up to the remaining cap. For example, $82,000 from the tax-free and taxed components leaves $49,250 of the cap. If the untaxed element is $76,000, the offset is $4,925.

For a pension that starts after 1 July or a recipient who turns 60 partway through the year, the cap uses the days from the later of the first payment date and the 60th birthday through 30 June. The calculator includes the first eligible day, divides by the number of days in that income year and rounds the cap up to the next dollar. Use the ATO’s defined benefit income guidance for combinations of different pension types.

Lump-Sum Component Calculations

A member lump-sum offset limits the income tax rate on eligible amounts. The estimate adds those amounts to your other taxable income, then compares the extra tax with the applicable ceiling. The offset is the amount by which the extra tax exceeds the ceiling. For a payment with more than one ceiling, the estimate applies the higher ceiling first when allocating the marginal brackets.

For a payment below preservation age, apply the 20% ceiling to the taxed element and 30% to the untaxed element within the remaining untaxed plan cap. From age 60, the taxed element is generally tax-free. The in-cap untaxed portion has a 15% ceiling. The untaxed portion over the plan cap is taxed at 45%, before any Medicare levy.

The 2026-27 untaxed plan cap starts at $1,935,000. Enter the amount of cap already used by earlier withdrawals or rollovers from the same plan. For an eligible 2023-24 payment made from preservation age to age 59, enter any low-rate cap already used across your plans. That year’s $235,000 lifetime cap gives the taxed element a 0% ceiling up to the amount remaining and a 15% ceiling above it. If the taxed element leaves room under the low-rate cap, the eligible untaxed amount can receive a 15% ceiling within both caps. See the ATO’s superannuation thresholds and lump-sum tax table.

The Medicare levy is separate from income tax and can still apply after an offset. The calculator compares the levy with and without the payment. Choose the single threshold, the full 2% levy or an exemption to match your circumstances. For a 2023-24 lump sum paid from preservation age to age 59, the taxed amount within the available low-rate cap is excluded from the levy calculation under the ATO’s Medicare levy instructions.

Worked Super Offset Comparisons

Take the example of a 66-year-old Australian resident with $72,100 of other taxable income and an $88,800 capped defined benefit pension in 2026-27. The pension has a $13,600 tax-free component, a $28,400 taxed element and a $46,800 untaxed element. The full-year cap covers all three. Only the $46,800 untaxed element is assessable. At a 30% marginal rate it adds $14,040 of income tax before the $4,680 offset. That leaves $9,360 of income tax and $936 of Medicare levy on the pension, for an estimated $78,504 after tax.

Now take a 58-year-old resident with $74,500 of other taxable income who receives a $50,500 lump sum in October 2026. The payment contains $4,500 tax-free, $32,800 taxed and $13,200 untaxed. The taxable $46,000 adds $13,800 of income tax at a 30% marginal rate. The untaxed amount stays within the plan cap and its 30% ceiling, so it adds $3,960 of tax. The 20% ceiling reduces the taxed element’s tax from $9,840 to $6,560. The $3,280 offset leaves $10,520 of income tax. Add $920 of Medicare levy and the estimated after-tax payment is $39,060.

The fund works out pay-as-you-go (PAYG) withholding under separate schedules. For the lump sum above, the standard 22% and 32% withholding rates would total $11,440, including the levy. A recipient with lower annual income might owe less at assessment even if the fund withheld the same amount. The cash the fund pays is the gross payment less withholding. The estimate shows what the payment is worth after its estimated tax and levy. The ATO credits amounts withheld when it assesses the return. See the PAYG schedules for superannuation lump sums and income streams.