{"id":"C2007A00011","name":"Superannuation (Excess Non-concessional Contributions Tax) Act 2007","slug":"superannuation-excess-non-concessional-contributions-tax-act-2007","collection":"act","jurisdiction":"commonwealth","status":"in_force","isInForce":true,"actNumber":"11 of 2007","makingDate":null,"administeringDepartment":null,"currentVersion":{"id":7956,"registerId":"commonwealth-C2007A00011-current","compilationNumber":null,"startDate":"2026-03-30","status":"InForce","reasons":null,"registeredAt":null},"sections":[{"sectionNumber":"1","sectionType":"section","heading":"Short title","content":"#### 1 Short title\n\n  This Act may be cited as the Superannuation (Excess Non‑concessional Contributions Tax) Act 2007.","sortOrder":0},{"sectionNumber":"2","sectionType":"section","heading":"Commencement","content":"#### 2 Commencement\n\n  This Act commences on the day on which it receives the Royal Assent.","sortOrder":1},{"sectionNumber":"3","sectionType":"section","heading":"Definitions","content":"#### 3 Definitions\n\n  In this Act:\n\n> excess non‑concessional contributions has the same meaning as in the Income Tax Assessment Act 1997.\n\n> financial year has the same meaning as in the Income Tax Assessment Act 1997.","sortOrder":2},{"sectionNumber":"4","sectionType":"section","heading":"Imposition of tax","content":"#### 4 Imposition of tax\n\n  Excess non‑concessional contributions tax payable under section 292‑80 of the Income Tax Assessment Act 1997 is imposed.","sortOrder":3},{"sectionNumber":"5","sectionType":"section","heading":"Amount of tax","content":"#### 5 Amount of tax\n\n  The amount of the tax is 47% of a person’s excess non‑concessional contributions for a financial year.","sortOrder":4},{"sectionNumber":"6","sectionType":"section","heading":"Temporary budget repair levy","content":"#### 6 Temporary budget repair levy\n\n  (1) This section applies to the temporary budget repair levy years.\n  (2) Increase the percentage mentioned in section 5 by 2 percentage points.\n  Increase limited if certain contributions already taxed\n  (3) However, do not increase the percentage in relation to a person to the extent the increase would result in the sum of the following amounts payable on the person’s excess concessional contributions for a temporary budget repair levy year exceeding 95% of those excess concessional contributions:\n    (a) income tax;\n    (b) excess non‑concessional contributions tax.\n  Definitions\n  (4) In this section:\n\n> excess concessional contributions has the same meaning as in the Income Tax Assessment Act 1997.\n\n> income tax has the same meaning as in the Income Tax Assessment Act 1997.\n\n> temporary budget repair levy year has the same meaning as in section 4‑11 of the Income Tax (Transitional Provisions) Act 1997.","sortOrder":5}],"analysis":{"issue_detection":{"absurdities":[{"type":"self_contradicting","section":"6(3)","severity":"high","reasoning":"Section 6(2) increases the tax rate on excess NON-concessional contributions by 2 percentage points. However, subsection 6(3) purports to limit that increase by reference to amounts payable on 'excess concessional contributions' for the same year. These are two entirely distinct categories of contributions under the ITAA 1997. The limiting mechanism is therefore referencing a different tax base than the provision it is meant to constrain. A cap on the non-concessional rate increase that is triggered by concessional contribution tax thresholds is logically incoherent — a person could have large excess non-concessional contributions but zero excess concessional contributions, making the cap meaningless or inapplicable in the most common scenarios where it would ostensibly be needed.","confidence":0.92,"description":"The cap in subsection 6(3) references 'excess concessional contributions' but section 6 is about excess NON-concessional contributions tax. The 95% cap is applied to the wrong category of contributions entirely."},{"type":"self_contradicting","section":"6(3)","severity":"high","reasoning":"The 95% ceiling is expressed as a percentage of 'excess concessional contributions', yet the two amounts being summed — income tax and excess non-concessional contributions tax — are computed on different bases. Excess non-concessional contributions tax under section 5 is 47% (or 49% during levy years) of excess NON-concessional contributions, not excess concessional contributions. Adding a dollar amount derived from one tax base to a dollar amount derived from a completely different tax base, and then expressing the sum as a percentage of only one of those bases, produces a ratio that is arithmetically and legally meaningless.","confidence":0.88,"description":"The 95% cap references both 'income tax' and 'excess non-concessional contributions tax' as the two components of the sum, but excess non-concessional contributions tax is levied on a different base (non-concessional contributions) than income tax on excess concessional contributions. Summing these two amounts as a percentage of excess concessional contributions is mathematically incoherent."},{"type":"other","section":"5","severity":"medium","reasoning":"Non-concessional contributions are made from amounts already subject to income tax. Imposing a further 47% tax on excess amounts (rising to 49% during levy years) means the underlying funds could be taxed at the individual's marginal rate first and then again at 47/49%, with no credit or offset provided within this Act itself. While the ITAA 1997 provides an associated earnings charge mechanism, this Act in isolation imposes a rate that can produce an aggregate effective tax rate well above 100% on the original pre-tax income that funded the contribution.","confidence":0.65,"description":"The flat 47% rate on excess non-concessional contributions is effectively a penalty rate designed to equal or exceed the top marginal income tax rate, but since non-concessional contributions are made from after-tax income, this creates a scenario of potential double taxation without any offset mechanism within this Act."}],"contradictions":[{"severity":"high","section_a":"5","section_b":"6(3)","confidence":0.92,"description":"Section 5 imposes tax on excess non-concessional contributions, but section 6(3) limits the levy increase by reference to excess concessional contributions, creating a direct contradiction between the subject matter of the tax being imposed and the subject matter of the limiting provision."},{"severity":"high","section_a":"6(2)","section_b":"6(3)","confidence":0.89,"description":"Section 6(2) mandates an unconditional 2 percentage point increase in the section 5 rate during levy years, while section 6(3) conditions a limitation on that increase by reference to 'excess concessional contributions' — a concept irrelevant to the section 5 tax base. The result is that the limiting proviso operates on a basis entirely foreign to the operative provision it purports to qualify, making it impossible to determine in which factual circumstances 6(3) could coherently constrain 6(2)."}]},"summary":{"complexity_score":4,"scope_assessment":{"changed":true,"description":"The core Act imposes a straightforward 47% tax on excess contributions. However, scope was temporarily expanded through section 6, which increased the rate to 49% during the 'temporary budget repair levy years' (2014–15 to 2016–17) as a fiscal consolidation measure. This addition went beyond the original purpose of simply penalising excess contributions and introduced a time-limited revenue-raising component, albeit with a safeguard cap. That temporary measure has since lapsed, effectively returning the Act to its original scope."},"complexity_factors":["Cross-references to multiple other Acts (Income Tax Assessment Act 1997 and Income Tax (Transitional Provisions) Act 1997), meaning the law cannot be fully understood in isolation","The distinction between 'concessional' and 'non-concessional' contributions requires background knowledge of superannuation law","The temporary budget repair levy section introduces a conditional percentage increase with a 95% cap calculation that requires careful reading","Confusing drafting in section 6(3) — it references 'excess concessional contributions' rather than 'non-concessional contributions', which creates interpretive difficulty","The actual contribution caps and triggering conditions are defined entirely elsewhere, making this Act incomplete without external reference"],"plain_english_summary":"## Superannuation Excess Non-Concessional Contributions Tax Act 2007\n\n### What is this law about?\n\nThis law imposes a **penalty tax** on people who put too much money into their superannuation (retirement savings) fund beyond a certain limit.\n\n### Key terms explained\n\n- **Non-concessional contributions**: Money you put into super from your *after-tax* income (i.e., money you've already paid income tax on — not employer contributions or salary sacrifice)\n- **Excess non-concessional contributions**: The amount by which your after-tax super contributions *exceed* the annual cap (limit) set by the government\n\n### Who does this affect?\n\nAnyone who contributes more after-tax money into their superannuation than the government's permitted annual limit. This can catch people who:\n- Make large lump-sum deposits into super\n- Accidentally contribute too much across multiple funds\n- Don't realise the caps apply to them\n\n### What does it actually do?\n\n1. **Imposes a 47% tax** on any super contributions you make above the allowed limit in a financial year — this is a very steep penalty designed to discourage over-contributions\n\n2. **During a special period** (the \"temporary budget repair levy years\" — financial years 2014–15 to 2016–17), the tax rate was temporarily increased by **2 percentage points to 49%**, though with a safeguard: the combined tax burden could never exceed **95%** of the excess amount\n\n### Why does this matter to you?\n\nIf you exceed your non-concessional contributions cap, the ATO (Australian Taxation Office) will effectively claw back nearly half of the excess as tax. This makes it crucial to track your super contributions carefully each financial year. The rules on what counts toward the cap are defined in separate, more detailed tax legislation."},"flash_summary":{"complexity_score":6,"scope_assessment":{"changed":true,"description":"This Act establishes a specific percentage‑based tax on excess non‑concessional superannuation contributions (47% per financial year) and creates a mechanism to temporarily raise that percentage by 2 percentage points in designated \"temporary budget repair levy years\" (s4–s6). It therefore extends and specifies the tax treatment of excess non‑concessional contributions by fixing the rate and by adding a time‑limited surcharge mechanism, relying on external legislation for key definitions and the temporary levy year timing (s3, s6(4))."},"complexity_factors":["Heavy reliance on cross‑references to the Income Tax Assessment Act 1997 for definitions (\"excess non‑concessional contributions\", \"financial year\") (s3, s4).","Interaction between different categories of excess contributions (non‑concessional vs concessional) in the temporary levy cap (s6(3)).","Temporal condition: the extra 2 percentage points apply only in defined \"temporary budget repair levy years\", which are defined in another Act (s6(1)–(2), s6(4)).","Numeric calculation and cap: base rate (47%) plus temporary increase, but limited so combined taxes do not exceed 95% of excess concessional contributions — requires aggregated arithmetic across tax types (s5, s6(2)–(3)).","Operational dependence on the administering agency to implement cross‑tax offsets and enforce payments given external definitions and references (s4, s6(4)).","Potential for confusion because the cap in s6(3) references \"excess concessional contributions\" while the primary tax is on non‑concessional excesses, requiring careful application of cross‑rules."],"plain_english_summary":"# What this law does\n\n- This Act creates and fixes the tax on \"excess non‑concessional contributions\" to superannuation. Those terms are defined by cross‑reference to the Income Tax Assessment Act 1997 (s3). The tax is the amount imposed under section 292‑80 of the Income Tax Assessment Act 1997 (s4).\n\n- The basic tax rate in this Act is 47% of a person’s excess non‑concessional contributions for a financial year (s5). \"Financial year\" is defined by reference to the Income Tax Assessment Act 1997 (s3).\n\n- For the years designated as \"temporary budget repair levy years,\" the Act increases that percentage by 2 percentage points (s6(1)–(2)). The increase is subject to a limit: the increase must not cause the sum of (a) income tax and (b) the excess non‑concessional contributions tax payable on a person’s excess concessional contributions for that temporary year to exceed 95% of those excess concessional contributions (s6(3)). The terms \"excess concessional contributions,\" \"income tax,\" and \"temporary budget repair levy year\" are defined by reference to other taxation laws (s6(4)).\n\n# Who this affects\n\n- Individuals (or legal entities treated as persons for superannuation tax purposes) who make contributions to superannuation that exceed the non‑concessional contribution cap in a financial year, as identified under the Income Tax Assessment Act 1997. Those persons are liable for the tax imposed by this Act (s3, s4, s5).\n\n# How it matters (mechanics, incentives, compliance and trade‑offs)\n\n- Who pays: the person whose contributions exceed the non‑concessional cap (s4–s5). The payer must calculate the excess per financial year using the definitions and rules in the Income Tax Assessment Act 1997 (s3, s4).\n\n- How much: a fixed percentage of the excess — 47% normally, 49% in temporary budget repair levy years unless limited by the 95% cap described in s6(3) (s5, s6(2)–(3)).\n\n- Administrative reliance and discretionary scope: the Act is mechanically prescriptive (fixed percentage) but depends on other laws for key definitions and the detailed calculation of \"excess\" and the operation of the cross‑crediting or interaction with income tax (s3, s4, s6(4)). That means accurate application requires reference to the Income Tax Assessment Act 1997 and the Income Tax (Transitional Provisions) Act 1997.\n\n- Incentives and private‑sector effects: by taxing excess non‑concessional contributions at a high percentage, the Act raises the private cost of making contributions above the legal caps (s5). This changes individual financial choices about how much to contribute to superannuation and when. The temporary 2 percentage point increase raises that marginal cost further in specified years (s6(2)). The 95% cap on the increase (s6(3)) creates an interaction between tax on concessional and non‑concessional excesses that can affect tax outcomes and planning decisions.\n\n- Compliance burden and implementation risk: taxpayers must use cross‑referenced definitions and compute excess contributions by financial year (s3). The Australian Taxation Office (or other administering agency) will need to apply the percentage, enforce payment, and manage the interaction with income tax in temporary levy years (s4–s6). Reliance on external definitions and a cross‑tax cap (s6(3)–(4)) increases the administrative complexity of calculation and compliance.\n\n# Trade‑offs and concrete costs\n\n- Cost to affected persons is immediate and explicit: a large fraction of any contribution that exceeds the non‑concessional cap is taken as tax (47% or higher in levy years) rather than remaining in the superannuation fund (s5, s6(2)).\n\n- The Act’s temporary increase clause (s6) is time‑limited to legislatively defined \"temporary budget repair levy years\" and subject to an arithmetic cap that limits the combined tax exposure relative to excess concessional contributions (s6(1)–(4)).\n\n- There is no discretionary relief or exemption in the text of this Act itself; the outcome for any person depends on the definitions and calculation rules in the Income Tax Assessment Act 1997 and related transitional provisions (s3, s6(4))."},"kimi_summary":{"content_quality":"ok","complexity_score":3,"scope_assessment":{"changed":false,"description":"The legislation remains tightly focused on its original purpose: imposing a specific tax rate on excess non-concessional super contributions. The temporary budget repair levy modification (section 6) was a time-limited revenue measure consistent with the Act's core function rather than scope creep."},"complexity_factors":["Only 6 sections total, with minimal text","Heavy reliance on external definitions — 5 terms defined by reference to other Acts (Income Tax Assessment Act 1997 and Income Tax (Transitional Provisions) Act 1997)","Single conditional provision (section 6) with a nested exception (subsection 6(3)) limiting the 2% increase","No internal machinery provisions — all administration, assessment, and collection handled by other legislation","Mathematical calculation is straightforward: fixed percentage of a defined amount"],"plain_english_summary":"This law creates a special tax penalty for Australians who put too much of their own after-tax money into their superannuation (super) retirement accounts.\n\n**What it does:**\n- **Hits you with a 47% tax** if you contribute more than the annual cap on non-concessional contributions (basically, personal contributions you make from money you've already paid income tax on).\n- The tax is calculated on the **excess amount** — whatever you went over the cap by.\n\n**Who it affects:**\n- Anyone who makes personal super contributions from their after-tax income and accidentally (or deliberately) exceeds the government's annual limits.\n- This typically affects higher-income earners or people with large lump sums trying to get money into the tax-advantaged super system.\n\n**The temporary budget repair levy bit:**\n- During specific \"temporary budget repair levy years\" (2014-15 to 2016-17), the tax rate was **bumped up to 49%** (47% + 2 percentage points).\n- There's a safeguard: if you've already been hammered with other taxes on the same money, the total tax bite can't exceed 95% of the excess contributions.\n\n**Why it matters:**\nSuperannuation has strict caps to stop wealthy Australians from using it as a tax shelter. This law is the enforcement mechanism — a punitive tax rate designed to make exceeding those caps financially painful and keep the system fair."}},"importantCases":[],"_links":{"self":"/api/acts/superannuation-excess-non-concessional-contributions-tax-act-2007","history":"/api/acts/superannuation-excess-non-concessional-contributions-tax-act-2007/history","analysis":"/api/acts/superannuation-excess-non-concessional-contributions-tax-act-2007/analysis","conflicts":"/api/acts/superannuation-excess-non-concessional-contributions-tax-act-2007/conflicts","importantCases":"/api/acts/superannuation-excess-non-concessional-contributions-tax-act-2007/important-cases","documents":"/api/acts/superannuation-excess-non-concessional-contributions-tax-act-2007/documents"}}