Technical and strategy update

Superannuation Division 296

The Better Targeted Superannuation Concessions Tax, commonly referred to as Division 296, will take effect on 1 July 2026 (FY27) and will introduce higher tax rates for individuals with super balances exceeding $3 million.

• The provision applies at an individual level only. It does not apply where, for example, an SMSF has $4m in total but each individual member holds $2m
• The additional tax is applied on a tiered system with an additional tax of 15% for members with a balance between $3m and $10m. And an additional tax of 10% to a member’s balance over $10m.
• The tax will apply to realised gains, not unrealised gains.  
• The thresholds of $3m and $10m will be indexed with Consumer Price Index (CPI).
• First Year Special Rules: Optional Capital Gain Reset & Total Super Balance Date.

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