Tax Planning
How Australia’s New Superannuation Reforms Affect High-Balance Accounts
Australia has updated its superannuation tax rules for those with balances above $3 million—learn how the changes to earnings taxes, indexing thresholds, and start dates impact you.
By NomadicTax Research Team • 5-8 min read • November 16, 2025
## What’s Changing for High-Balance Super Accounts
Australia’s **Better Targeted Superannuation Concessions (BTSC)** have been revised. Here’s what you need to know: key thresholds are now being increased and indexed, and earnings will only be taxed on **realised** gains, not mere market fluctuations. ([ministers.treasury.gov.au](https://ministers.treasury.gov.au/ministers/jim-chalmers-2022/media-releases/reforms-support-low-income-workers-and-build-stronger?utm_source=openai))
### Breakdown of the New Rules
| Balance Tier | Concessional Tax Rate on Earnings | When It Starts | Other Key Details |
|--------------|------------------------------------|----------------|---------------------|
| $0–$3 million | **15%** (unchanged) | 1 July 2026 ([ministers.treasury.gov.au](https://ministers.treasury.gov.au/ministers/jim-chalmers-2022/media-releases/reforms-support-low-income-workers-and-build-stronger?utm_source=openai)) | Used to be taxed at current concessional rates; earnings defined as realised income. |
| $3 million–$10 million | **30%** | 1 July 2026 ([ministers.treasury.gov.au](https://ministers.treasury.gov.au/ministers/jim-chalmers-2022/media-releases/reforms-support-low-income-workers-and-build-stronger?utm_source=openai)) | Threshold now indexed to inflation. |
| Over $10 million | **40%** | 1 July 2026 ([ministers.treasury.gov.au](https://ministers.treasury.gov.au/ministers/jim-chalmers-2022/media-releases/reforms-support-low-income-workers-and-build-stronger?utm_source=openai)) | Applies only to earnings above this threshold. |
## Realised vs. Unrealised Earnings: Why It Matters
Originally, the government planned to tax **unrealised gains**—such as the increase in value of investments like shares or property even before they’re sold. Critics warned this could unfairly hit people with illiquid assets. Now, the tax will only apply once gains are *realised*, e.g. through sales or distributions. ([ministers.treasury.gov.au](https://ministers.treasury.gov.au/ministers/jim-chalmers-2022/media-releases/reforms-support-low-income-workers-and-build-stronger?utm_source=openai))
## Who’s Affected and What It Costs
- Less than **0.5% of superannuation account holders** will be directly impacted. ([theguardian.com](https://www.theguardian.com/australia-news/2025/oct/13/new-rules-have-been-proposed-for-your-super-heres-what-you-need-to-know?utm_source=openai))
- Budget estimates show the change will raise approximately **AUD 1.6 billion in 2028–29**, down from earlier projections of about AUD 2.7 billion due to threshold changes and delay. ([theguardian.com](https://www.theguardian.com/australia-news/2025/oct/13/new-rules-have-been-proposed-for-your-super-heres-what-you-need-to-know?utm_source=openai))
## What You Can Do Now
- **Check your super balance**: If close to or above $3 million, plan for the new tax rate.
- **Consider realising gains strategically**: Since only realised earnings count, timing sales/distributions before the legislation becomes effective (1 July 2026) may help.
- **Monitor thresholds for indexing**: Those nearing thresholds may get ‘pushed’ into the higher rate if indexing raises the limits.
- **Speak to your super fund**: Ask how they’ll track realised vs. unrealised earnings under your investment mix. |
## Summary
These reforms aim to increase fairness by ensuring low- and middle-income earners aren’t squeezed while also asking wealthier super fund holders to contribute a bit more. If you have large super savings, it’s time to revisit your strategy—and ensure you stay ahead of the changes taking effect in mid-2026.