The Government Super Co-Contribution: Turn a $1,000 Deposit Into Up to $500 From the ATO
If you earn a modest income and manage to put some of your own money into super after tax, the government will often add to it — up to $500 for every $1,000 you contribute. That's the government super co-contribution in a sentence, and more people walk past it than claim it, mostly because it doesn't look like a typical ATO incentive. There's no box to tick on a form, no separate application, and no mention of it in most of the deduction checklists people search for every July.
We see this most often with part-time and casual workers, people returning from parental leave, and small business owners whose income dips below the higher threshold in a quiet year. Nobody tells them the co-contribution exists until the money has already landed in their account months later — which is a fine outcome, but one that depends entirely on actually making the contribution before 30 June.
This guide sets out who qualifies, the 2026-27 income thresholds, how the payment is actually calculated and paid, and the handful of mistakes that quietly disqualify people who were otherwise eligible. Baron Tax & Accounting is a registered tax agent based in Rochedale South, Brisbane, working with individuals and sole traders across Australia on exactly this kind of year-end super planning, and the co-contribution is one of the few genuinely free top-ups the ATO offers — it's just easy to miss.
In this guide:
What the co-contribution actually is
The mechanics are simpler than most super concessions. If your income sits at or below the lower threshold for the year and you make a personal, after-tax contribution to your super fund, the government matches 50 cents for every dollar you put in, up to a maximum contribution of $1,000 — which caps the government's side at $500. Put in less than $1,000 and you still get the 50% match on whatever you contributed; put in more than $1,000 and the extra doesn't attract any additional co-contribution.
That matching only applies to personal, non-concessional contributions — money you've already paid tax on and haven't claimed, or don't intend to claim, as a tax deduction.
Employer contributions, including compulsory Super Guarantee payments and salary sacrifice arrangements, don't count toward this at all, because they're concessional contributions taxed differently inside the fund. Section 5 below goes through exactly which contributions qualify, because this is where we see the most mix-ups.
Who qualifies for it
Eligibility comes down to five conditions, and the ATO checks all of them automatically once you lodge your tax return for that year:
You made an eligible personal super contribution to a complying fund or retirement savings account during the income year, and didn't claim it as a tax deduction.
At least 10% of your total income for the year came from employment, running a business (including as a sole trader), or a combination of the two.
Your total income for the year was below the higher income threshold (covered in the next section).
You were under 71 years old at the end of the income year.
Your total super balance was below $2 million as at the end of the previous financial year.
There's also a residency condition: you can't have held a temporary resident visa at any point during the year, unless you're a New Zealand citizen or hold one of a small number of prescribed visa types. None of this requires an application — eligibility is assessed automatically, which section 6 covers in more detail. (ATO, Government super contributions)
The 2026-27 income thresholds, and how the payment tapers
For contributions made in the current 2026-27 financial year — which the ATO assesses against your 2026-27 tax return — the figures are:
Lower income threshold: $49,293
Higher income threshold: $64,293
Maximum co-contribution: $500
Below the lower threshold, you get the full 50% match. Between the two thresholds, the maximum entitlement reduces progressively as your income rises, reaching nil once you hit $64,293. The $15,000 gap between the two thresholds has stayed fixed since 2012, even as both figures are indexed upward each year, so the taper always runs over the same income range — it's just sliding higher as wages grow. (ATO, Government contributions)
Why the numbers on your current tax return are different
If you're reading this around the usual late-October lodgment period, it's worth being precise about which year's numbers actually apply to you, because two different sets are in play at once. The tax return most people are lodging right now covers the 2025-26 income year, and any co-contribution on that return is assessed against the 2025-26 thresholds: a $47,488 lower threshold and a $62,488 higher threshold, still with the same $500 cap. The $49,293 and $64,293 figures in the previous section apply to contributions you make between 1 July 2026 and 30 June 2027, which won't show up as a co-contribution until you lodge next year's return.
It's a small distinction, but it matters if you're trying to work out, right now, whether a contribution you made back in March qualifies — use the 2025-26 numbers for that. If you're instead planning how much to put in before this coming 30 June, use the 2026-27 numbers above.
Which contributions count, and which don't
This is the section that trips people up more than any eligibility rule. To qualify, the contribution has to be personal and non-concessional — money you contribute yourself, from your own bank account or take-home pay, that you haven't claimed and don't intend to claim as a tax deduction.
That rules out a few things people assume are included. Salary sacrifice contributions don't count, even though they come out of your own pay, because your employer makes them before tax and they're taxed concessionally inside the fund. The compulsory Super Guarantee your employer pays on top of your wages doesn't count either. And if you make a personal contribution and then claim all or part of it as a tax deduction on your return — a legitimate strategy in its own right, just a different one — the deducted portion becomes concessional and stops being eligible for the co-contribution. Downsizer contributions, which come from selling a home, are excluded as well.
One detail worth knowing: a government co-contribution doesn't count toward either your concessional or non-concessional contributions cap, so topping up for it doesn't eat into the $130,000 non-concessional cap for 2026-27 or push you toward excess contributions. (ATO, Understanding concessional and non-concessional contributions)
How the money actually lands in your account
There's no form to lodge and no portal to apply through. Once you've made the contribution and lodged your tax return for that year, the ATO calculates your entitlement automatically from the information your fund and your return provide, and pays it directly into your super fund — not to you personally. The only practical thing you need in order is a tax file number recorded with your fund; without it, the co-contribution can't be paid at all. Processing happens progressively through the year as tax returns are lodged and finalised, so the payment typically turns up some weeks or months after your notice of assessment, rather than alongside it.
Sole traders, casual and part-year workers
This is one of the few super concessions that genuinely reaches individuals, sole traders and casual workers alike, rather than being built around a single employee archetype. For a sole trader, business income counts toward the 10% employment-and-business-income test in exactly the same way wages do, so someone running a small trades or services business on modest profit can qualify just as easily as a part-time employee. Where it gets interesting is for people with mixed income — a bit of PAYG work alongside a small ABN side business — because both streams are added together for the test.
Casual and part-time workers, people returning from parental leave partway through the year, and students working limited hours are the group we see benefit most in practice, simply because their income naturally sits closer to the lower threshold. It's worth checking the numbers even in a year where your income was unusually low for reasons outside your control.
Where people get this wrong
Of the mistakes we see, one stands out as costing people the most money for no good reason: setting up an ongoing salary sacrifice arrangement and assuming it serves the same purpose as a personal contribution. It doesn't — and because salary sacrifice happens automatically through payroll, people often don't realise they haven't made an eligible contribution until their notice of assessment comes back with no co-contribution on it.
The second common issue is timing. A contribution has to be received and processed by your super fund by 30 June, not merely initiated — a BPAY payment made on 29 June can easily land in the fund in the new financial year instead, which pushes the whole thing into the wrong income year's test. Leaving it to the last week of June is the single easiest way to lose the payment entirely.
Less serious, but still common: people check last year's thresholds instead of the current year's, assume the scheme is only for employees and overlook it as sole traders, or forget that their fund needs a tax file number on file before the ATO can actually pay anything into it.
How this fits into a bigger super strategy
The co-contribution sits at a different point in the income spectrum from most of the super planning we write about. Where salary sacrificing extra concessional contributions mainly benefits people on higher marginal tax rates, and Division 293 tax only applies once combined income passes $250,000, the co-contribution is specifically aimed at lower and middle incomes — it's one of the only government super incentives that gets more generous as your income falls, rather than less. For a first home buyer weighing up a First Home Super Saver Scheme strategy against general retirement saving, or someone deciding between salary sacrifice and a straight after-tax contribution, the co-contribution is worth factoring in before deciding where the next dollar into super should go.
How Baron Tax & Accounting can help
Working out which contribution type actually qualifies, and whether it's worth prioritising over salary sacrifice or a deductible personal contribution, depends on your income, your other super settings and what you're trying to achieve by 30 June. Through our online tax return service, you give us your details, a registered tax agent reviews your income and contribution history, and we tell you exactly what you're eligible for and what still needs to happen before the financial year closes — rather than you working through the thresholds and caps on your own. If you'd rather have someone check your eligibility and handle the lodgment than puzzle through it yourself, get in touch and we'll take it from there.
Frequently asked questions
Do I need to apply for the government super co-contribution?
No. There's no form and no separate application. As long as you've made an eligible personal contribution and lodged your tax return for that year, the ATO works out your entitlement automatically and pays it into your super fund, provided your fund has your tax file number on record.
What counts as total income for the 10% test?
Total income for this test is your assessable income plus reportable fringe benefits and reportable employer super contributions, less allowable business deductions. It's a slightly different figure from your taxable income, so it's worth checking rather than assuming.
Can I still get the co-contribution if I salary sacrifice instead of making an after-tax contribution?
No. Salary sacrifice contributions are concessional (pre-tax) and don't count toward the co-contribution, even though the money still comes out of your own pay. Only personal, after-tax contributions you haven't claimed as a deduction qualify.
What happens if my income falls between the two thresholds?
The maximum $500 entitlement reduces progressively as your income rises from the lower to the higher threshold, reaching nil once you reach the higher threshold. The ATO calculates the exact amount when you lodge, based on your actual income and contribution for that year.
Does the co-contribution count toward my super contribution caps?
No. Government co-contributions are specifically excluded from both the concessional and non-concessional contributions caps, so receiving one doesn't put you at risk of exceeding either limit.
Can sole traders and self-employed people get the co-contribution?
Yes. Business income is treated the same as employment income for the 10% test, so a sole trader whose income is mostly business profit can qualify in the same way a part-time employee can, provided the other eligibility conditions are met.
Related reading
• The First Home Super Saver Scheme: What You Can Actually Withdraw Toward a Home Deposit in 2026-27
Contact Baron Tax & Accounting
If you have questions about your own eligibility for the co-contribution, or want help with your tax return more generally, we're here to help.
Address: 758 Underwood Road, Rochedale South QLD 4123
Phone: +61 7 3706 3147 or 1300 087 213
Email: info@baronaccounting.com
Hours: Monday–Friday 09:30–17:00
Disclaimer
This article provides general information only and does not constitute personal tax or financial advice. It does not take into account your objectives, financial situation or needs. Tax rules change and apply differently to each person's circumstances. Before acting, please seek advice from a registered tax agent. Baron Tax & Accounting accepts no liability for any loss arising from reliance on this article. Source references: ATO (ato.gov.au) and other Australian government agencies, current as at the date of publication.
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