Australian Superannuation Guide For Same Sex Couples

Superannuation rights for same-sex couples in Australia were endorsed by the majority of citizens and in parliament. Although such relationships were not equal under the laws of marriage until December 2017/January 2018, they were considered legitimate and equal, for superannuation entitlements. This also happened quite recently though. Many of the homophobic inequities in superannuation and retirement policy are now eradicated.

Superannuation Guide For Same Sex Couples in Australia

The laws apply equally to single, married, de facto, gay, lesbian or heterosexual people. However, special rules apply under these circumstances:

  • Making super contributions

Most rules regarding super contributions apply for all. There are two different instances:

  • Contribution splitting
  • Spouse contributions

In Death

A same-sex partner is considered as ‘spouse’ under super laws, meaning any superannuation benefits paid out to a partner after the other’s death will be tax-free as a lump sum. The death benefit is likely to be tax-free as a superannuation pension (if aged above 60, or surviving partner is over 60).

Setting Up and Running a Self-managed Super Fund (SMSF)

  • The eligibility rules for SMSF members are more straightforward for a same-sex couple wanting to run an SMSF together.
  • SMSF trustees cannot lend money to a member or a relative of a member. A same-sex partner is now considered a ‘relative’.

Relationship Breakdown (separating)

The federal laws relating to the recognition of superannuation assets within a same-sex relationship have changed, and benefit splitting is now permitted (not in Western Australia) although it’s very complicated.

Nearly all employees are entitled to superannuation. If you earn above $450 monthly, your employer should pay 9.5% of your earnings to a super fund (known as a super contribution). Compulsory contributions (Superannuation Guarantee) should be paid at least quarterly.

You can make your own super contributions – before-tax contributions (salary sacrifice or tax-deductible contributions), or after-tax contributions (non-concessional contributions) which may be deducted from your take-home pay, or sourced from private savings.

Australian employees entitled to superannuation, or self-employed people making their own super contributions can receive tax incentives on superannuation at these stages:

  • Before-tax contributions (concessional contributions)
  • Co-contribution
  • Investment earnings
  • Tax-free retirement benefits

For superannuation, a ‘spouse’ now means:

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