$3m Super tax will apply from 1 July 2026

From 1 July 2026, a new tax – formally known as Division 296 will apply to individuals with large superannuation balances. It is often referred to as the “$3 million super tax”.

Division 296 applies if your total superannuation balance across all funds exceeds:

• $3 million – an additional 15% tax may apply to part of your super earnings
• $10 million – a further 10% tax may apply to earnings linked to balances above this level.

Key points to note:

• It does not cap how much you can hold in super
• The tax applies to earnings, not your full balance
• Unrealised gains are not taxed — only actual income and realised capital gains are included
• The thresholds will be indexed over time

Division 296 is a personal tax assessed by the ATO. When an assessment is issued, you can choose to pay it personally or have it paid from your super under special release rules.

The first balance test will occur 30 June 2027, with assessments expected to issue in the 2027/2028 income year.

Most Australians will not be affected. If your total super balance is approaching $3 million, it may be worth reviewing your position and seeking advice.

Published 26/03/26