$450 super threshold is no more

In a move that’s widely considered to make super fairer, the government has passed the long-awaited bill to remove the minimum monthly income threshold for compulsory super guarantee to apply.  

At the moment, if you earn less than $450 a month (before tax), your employer doesn’t have to pay you any super. What’s more, even if you’re doing two or three jobs, which together give you a good income, you still won’t get any super if each of those jobs pay you less than $450 (before tax).  

The passing of the bill means, from 1 July 2022, you will be eligible to receive compulsory employer super guarantee payments, no matter how much you earn. 

This move was first proposed in the 2021-22 Federal Budget, and many believe that it will make super fairer and boost women’s financial security in retirement.  

Young people and women often do casual or part-time work. In fact, the peak industry body, the Association of Superannuation Funds of Australia (ASFA) believes removing the income threshold will benefit around 300,000 people, of whom approximately 63 per cent are female.  

Overall, this measure means more super for those on a low income, leading to better retirement outcomes—after all, even small amounts of super can make a difference in the long term. 

ASFA. 10 February 2022. Removing the SG $450 threshold and retirement income covenant will improve super outcomes.

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