Superannuation Shake-Up: The $3M Cap and What It Means for High-Balance Accounts

The Australian Government has unveiled a major change to the superannuation system that’s set to take effect from 1 July 2025—and if you hold more than $3 million in your super fund, this is news you can’t afford to ignore.

Under the new rules, earnings on superannuation balances exceeding $3 million will be taxed at 30%, doubling the current concessional rate of 15%. For high-balance account holders, this shift represents a significant increase in tax liability—and it’s sparking widespread discussion among investors, advisers, and business owners.

Let’s break down what’s changing and what proactive steps you can take to stay ahead.

💼 What’s Changing?

Currently, earnings on all superannuation funds are taxed at a concessional rate of 15%, regardless of balance size. But from FY2025–26, the government is introducing a new tax regime:

• Superannuation earnings on balances under $3 million: Taxed at 15% (no change)

  
  

• Earnings on balances above $3 million: Taxed at 30%

Importantly, this tax will be applied only to the portion of earnings attributable to the excess amount, not the entire balance.

This means if your total super balance is $4 million, only the earnings generated from the $1 million excess will be subject to the higher tax rate.

📊 Why This Matters for High-Net-Worth Individuals and Business Owners

This reform primarily targets high-net-worth individuals who have used superannuation as a long-term wealth-building vehicle. It’s a strong signal that the government is looking to recalibrate the tax concessions available to wealthier Australians.

If you’re a business owner with a self-managed super fund (SMSF), or a professional nearing retirement with a large super balance, this change could significantly alter your long-term tax planning and investment strategy.

Key impacts to consider:

• Increased tax obligations on future growth

  
  

• A possible shift in the attractiveness of superannuation compared to other investment structures

  
  

• The need for more active management of contributions, earnings, and withdrawals

🔍 Planning Ahead: What Should You Do Now?

The new tax regime may still be a year away, but early planning is crucial to avoid surprises and preserve your long-term financial goals.

Here are a few strategies to consider:

✅ Review Your Super Balance

Get a clear picture of your current and projected balance. If you're approaching the $3M threshold, strategic planning can help reduce future tax burdens.

✅ Diversify Your Investments

Consider whether it makes sense to redirect future investments outside of super, such as into a family trust, company, or personal portfolio—each with their own tax considerations.

✅ Reassess Contribution Strategies

Work with an accountant or financial adviser to ensure you’re not over-contributing or inadvertently pushing your balance into the higher-tax zone.

✅ Evaluate Your SMSF Structure

For those with self-managed funds, now is the time to ensure your investment strategies and structures are aligned with the upcoming changes.

🤝 How Worldwide Advisory Can Help

At Worldwide Advisory, we work closely with individuals and businesses to navigate complex superannuation and taxation reforms. Our experienced team can help you:

• Understand your exposure to the new 30% tax

  
  

• Explore alternative tax-effective investment vehicles

  
  

• Restructure your financial plans to protect your wealth

  
  

• Ensure compliance while maximising growth opportunities

📞 Take Action Now Before the Rules Kick In

With changes set to take effect from 1 July 2025, the time to act is now. A proactive approach can help you minimise risk, protect your assets, and continue growing your wealth with confidence.

Call Worldwide Advisory today on +617 3180 1684 or Email contact@worldwideadvisory.au to schedule a strategy session.

Let us help you future-proof your financial wellbeing and make informed decisions in a changing superannuation landscape.