The “Better Targeted Superannuation Concessions” (BTSC) legislation is now law and will take effect from 1 July 2026, introducing additional tax for individuals with high super balances.
What Is Changing?
The reform introduces an additional tax on super earnings for individuals with a Total Super Balance (TSB) above $3 million.
Key features include:
- Additional 15% tax on earnings attributable to balances above $3 million
- Applies across all super accounts combined (SMSFs and APRA funds)
- Assessed to the individual (not the fund), with flexibility in how it is paid
Why Has This Been Introduced?
The policy is designed to:
- Reduce tax concessions for very large super balances
- Improve perceived fairness in the tax system
- Redirect budget savings to broader economic priorities
The government has stated that only a small percentage of Australians will be impacted.
What Does This Mean in Practice?
If your balance is:
- Below $3 million → no impact
- Approaching or above $3 million → you may face additional tax on earnings
This could affect:
- SMSF strategies
- Asset allocation (especially growth vs income assets)
- Liquidity planning (to fund potential tax liabilities)
What Should You Do Now?
- Check your Total Super Balance (TSB)
- Project future balances and earnings growth
- Review whether your current structure is still optimal
- Seek advice early — especially if you hold property or illiquid assets inside super
While this change targets a small group, the planning implications can be significant.
