Key Highlights

  • As self-lodgers work towards the 31 October 2026 deadline for their 2025–26 returns, one of the tax system's smaller and less-publicised breaks is worth a look.
  • The spouse contribution tax offset is worth up to $540 a year.
  • The offset is 18% of the lesser of two amounts: the spouse contributions you actually made, or $3,000 reduced by however much your spouse's income exceeds $37,000.
  • In practice, the full $540 is available where the spouse's income is $37,000 or less and you contribute at least $3,000.

As self-lodgers work towards the 31 October 2026 deadline for their 2025–26 returns, one of the tax system's smaller and less-publicised breaks is worth a look. Under enacted rules, a person who makes an after-tax contribution to the super of a low-income spouse can claim a tax offset of up to $540 a year, and couples can separately split contributions to even out their balances.

How the Spouse Contribution Offset Works

The spouse contribution tax offset is worth up to $540 a year. It is available when you contribute to your spouse's super from after-tax money and their income is below a set threshold.

The offset is 18% of the lesser of two amounts: the spouse contributions you actually made, or $3,000 reduced by however much your spouse's income exceeds $37,000.

In practice, the full $540 is available where the spouse's income is $37,000 or less and you contribute at least $3,000. The offset phases out between $37,000 and $40,000 of spouse income, reaching nil at $40,000.

The ATO's spouse contributions page sets out the rules, which have not changed in recent years. Because the offset is a fixed dollar amount, its value does not depend on the contributing partner's marginal tax rate.

What Counts as 'income' for the Test

Income for the offset test is not simply salary. It is the spouse's assessable income, plus reportable fringe benefits, plus reportable employer super contributions.

First home super saver released amounts are excluded from the assessable income figure. Reportable employer super contributions include amounts salary-sacrificed into super, so a spouse who salary sacrifices could have a higher income for this test than their take-home pay suggests.

The same applies to reportable fringe benefits. A spouse on modest wages who also receives significant fringe benefits through their employer could find their income for the test pushed into, or beyond, the $37,000 to $40,000 phase-out band.

It is the receiving spouse's income that matters here. The contributing partner's own income does not affect the size of the offset.

Who Qualifies, and Who Doesn't

Several conditions apply. The receiving spouse must be under 75 when the contribution is made. Their total super balance, not the contributor's, must be below the general transfer balance cap immediately before the start of the financial year, and they must not exceed their non-concessional contributions cap for the year.

Both partners must be Australian residents, and they must not be living separately and apart on a permanent basis.

The contributing partner cannot claim a tax deduction for the contribution. Because it is made from after-tax money, it counts as the spouse's non-concessional contribution. For 2026–27, the non-concessional cap is $130,000, according to the ATO.

The offset also cannot be claimed for your own contributions that you later split to your spouse. The two strategies are separate, and the same dollars cannot be used for both.

Hypothetical Examples: Working Out the Offset

Hypothetical example: Priya's income for the year is $25,000. Her partner, Sam, contributes $3,000 to her super account. Because Priya's income is below $37,000, the lesser amount is $3,000, and Sam's offset is 18% of $3,000, or $540.

If Sam instead contributed $5,000, the offset would still be $540, because the calculation is capped at $3,000. If he contributed only $1,000, the lesser amount would be $1,000, and the offset would be 18% of that, or $180.