Carry-Forward Unused Cap
The ability to use unused concessional contribution cap amounts from the previous 5 years, if your total super balance is under $500,000.
Since 1 July 2018, individuals with a total super balance below $500,000 at 30 June of the previous year can carry forward unused concessional contribution cap amounts from up to 5 previous financial years. This allows you to make larger concessional contributions in a single year without exceeding your available cap, and is particularly valuable for those with irregular income or who want to make catch-up contributions.
The first year unused amounts could be accrued was 2018-19 (when the cap was $25,000). So the maximum carry-forward balance accumulated over 5 years depends on the caps that applied in each year: $25,000 for 2018-19 to 2020-21, $27,500 for 2021-22 to 2023-24, $30,000 for 2024-25 and 2025-26, and $32,500 from 2026-27. Unused amounts expire after 5 years on a first-in, first-out basis.
For example, if your SG contributions have been $15,000 per year and you haven't made any additional concessional contributions, you'd have approximately $15,000 unused cap per year. Over 5 years, that's about $75,000 of accumulated unused cap. In the current year, you could contribute up to $107,500 (current year $32,500 + $75,000 carry-forward) as concessional contributions. This strategy is commonly used when receiving a bonus, inheritance, or windfall that you want to direct into super tax-effectively.
How it works
Carry-forward lets you use concessional contributions cap space you didn't use in any of the previous five financial years, on top of the current year's cap, provided your total super balance was under $500,000 at the end of the previous 30 June. It's designed for people whose income or capacity to contribute varies year to year, rather than assuming everyone can contribute the same amount every single year.
In practice, you or your accountant check your unused cap amounts on ATO online services through myGov before deciding how much to contribute — the ATO tracks this automatically based on what each of your funds reports. Unused amounts are used up on a first-in, first-out basis, and any amount not used within five years simply expires rather than accumulating indefinitely.
The $500,000 total super balance test applies at the end of the financial year before the one you're contributing in, so a balance that grows during the current year doesn't retroactively disqualify you. Carry-forward is commonly used after a bonus, inheritance, or windfall, or by someone returning from a lower-income period like parental leave who wants to catch up on contributions made lighter in earlier years.
Example: using unused cap from a previous year
Suppose last financial year your employer contributed $22,000 in SG and you made no other concessional contributions, against a cap of $30,000 that applied that year — leaving $8,000 of cap unused. Combined with this year's $32,500 cap, you could contribute up to $40,500 in concessional contributions this year using just last year's unused amount.
If you also had unused cap sitting from earlier years within the five-year window, that would add further room on top of the $40,500 — but only if your total super balance was under $500,000 at the end of the previous 30 June, since that's what determines whether you can use carry-forward at all.
Related Terms
Concessional Contributions
Before-tax super contributions taxed at 15% inside the fund, including employer SG, salary sacrifice, and personal deductible contributions.
Salary Sacrifice
An arrangement where you direct part of your pre-tax salary into super (or other benefits), reducing your taxable income.
Superannuation Guarantee (SG)
The compulsory minimum percentage of an employee's qualifying earnings (formerly ordinary time earnings) employers must contribute to their super fund.
Total Superannuation Balance
The total value of all your super interests across all funds, used to determine eligibility for various super concessions.