Division 296 Tax Calculator: How much will you pay?
Updated 26 January 2026
The proposed Better Targeted Superannuation Concessions Tax (BTSC Tax), commonly referred to as Division 296, is set to impact individuals with superannuation balances exceeding $3 million, including self-managed super funds (SMSFs).
The Ord Minnett Division 296 Tax Calculator helps you estimate your potential tax liability if the measure is legislated.
What is the new
Division 296 Tax?
Division 296 is a new tax set to be introduced by the Government. If it passes through parliament, it will apply to individuals with superannuation balances exceeding $3 million.
- Realised earnings attributable to the portion of your Total Superannuation Balance (TSB) between $3 million and $10 million will be taxed an additional 15%.
- Realised earnings attributable to the portion of your Total Superannuation Balance (TSB) over $10 million will be taxed an additional 25%.
- Division 296 hasn’t been legislated yet and is currently under government consultation.
If it successfully passes, the first assessment for Division 296 will be based on individual TSB’s at the end of the 2026/27 financial year.
Division 296 could impact your financial strategy. That's why it's important to understand exactly how the Division 296 tax applies in your situation.
Calculate how Division 296
will affect you
Want to see how much you stand to pay under Division 296? Enter your details into our calculator and find out.
How is Division 296 calculated?
The Division 296 tax is calculated based on the following:
Get the Division 296 Tax Quick Reference Guide
If you are looking for more information, you can download a complimentary copy of our Division 296 Tax Quick Reference Guide. It includes an overview of the legislation, key features, and important considerations.
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Division 296 Tax Update
What has changed?
Treasurer Jim Chalmers announced further changes to the Federal Government’s $3 million superannuation tax reform under Division 296 on Friday 19 December 2025.
Also known as the “Better Targeted Superannuation Concessions tax” or BTSC tax, the revised proposal saw several changes, including:
Unrealised gains
The proposed policy will no longer tax unrealised gains. Instead, it will work on a realised earnings basis and will be applied to dividends, interest, rent and realised gains. These earnings are calculated by the fund and attributed to members, and the Division 296 tax is then applied to the portion of realised earnings that relates to balances above the relevant thresholds.
Indexation
Previously, there was no plan outlined to address the issues of inflation and bracket creep. In the proposed policy, both the $3 million and $10 million thresholds will be indexed annually (in $150,000 and $500,000 increments, respectively), maintaining relativity with the Transfer Balance Cap.
Start Date
Commencement has been delayed to 1 July 2026, allowing time for further consultation and system readiness.
Tiered tax rates introduced
- An additional 15% tax on earnings from balances between $3 million and $10 million.
- An additional 25% tax on earnings from balances above $10 million.
Get expert advice to manage Division 296 changes
When changes like the Division 296 tax arise, it's important to get quality financial advice. That's where our team of private wealth advisers can help.
We have the knowledge and experience to provide guidance on legislative changes like Division 296. Our research teams and tax specialists work hand-in-hand to help grow your wealth.
Start a conversation with us today and take control of your personal wealth.
Division 296 Frequently Asked Questions
Basics & Definitions
What are realised earnings?
Realised earnings are income received by your fund, such as dividends, interest, rent, and realised capital gains. These earnings are calculated by the fund and attributed to members, and the Division 296 tax is then applied to the portion of realised earnings that relates to balances above the relevant thresholds.
What counts as my Total Super Balance (TSB)?
Your Total Super Balance (TSB) includes the value of all your superannuation interests across your superannuation funds, including any SMSF member balance. For most superannuation rules, the TSB also includes certain adjustments such as Limited Recourse Borrowing Arrangement (LRBA) amounts.
However, for Division 296 purposes, the exposure draft states that LRBA amounts will be disregarded, so these borrowings will not be added back when determining whether you exceed the Division 296 thresholds or when calculating your Division 296 tax liability.
This ensures that a member’s balance is not artificially increased for the purposes of the new tax.
Application & Scope
Who does Division 296 affect?
Division 296 applies to individuals whose Total Superannuation Balance (TSB) exceeds $3 million at the end of the financial year. This includes balances held in self-managed super funds (SMSFs) and public funds. From 1 July 2027, Division 296 will apply if an individual’s TSB as of 1 July, or the TSB as of 30 June exceeds the $3 million threshold.You should seek professional financial advice before making decisions.
You should seek professional financial advice before making decisions.
Are some people excluded from Division 296 tax?
Yes. For example, child pension recipients and people who have received structured settlement contributions won’t be taxed under Division 296. Some special funds are also treated differently.
Does Division 296 apply to self-managed super funds?
Yes, Division 296 tax liabilities apply to SMSFs.
While there are a few differences to keep in mind, Division 296 tax liabilities are broadly similar for SMSFs and public fund members.
What about defined benefit pensions?
Earnings will be calculated using the change in the defined benefit balance over the financial year, with adjustments for contributions, withdrawals and a prescribed factor. Where benefits are not yet payable from a defined benefit interest, Division 296 tax liabilities can be deferred into a Division 296 debt account and become payable when the first benefit is paid.
Timing & Payment
Should I take money out of my Super if my balance is over $3 million or $10 million threshold?
Not necessarily. In the first financial year (2026–27), Division 296 is based on your 30 June 2027 TSB, so withdrawing before year end may reduce your balance for that initial assessment.
From 2027–28 onwards, the higher of your opening and closing TSB will be used when determining whether Division 296 applies. This means withdrawing later in the year generally won’t prevent the tax from applying if your 1 July balance was already above the threshold.
Withdrawals may also create other tax consequences, such as capital gains tax, so it’s important to get professional financial advice before making decisions.
When do I need to make my first tax payment?
The tax will first be due in the 2027/28 financial year.
The ATO will issue a Division 296 assessment when it has sufficient information to assess an individual’s liability. This assessment is generally due 84 days after the notice is issued. The tax can be paid personally, or an ATO release authority can be used within 60 days so a super fund releases money to the ATO.
Can investments be grandfathered under Division 296?
The election to grandfather assets will be allowed for small Super funds, such as SMSFs, however importantly, super funds must elect to apply the option by the due date for lodging the tax return for the 2026-27 Financial Year. This option is not available for public Super fund accounts such as industry funds.
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Important Information
This webpage provides general information only and does not constitute financial, investment, or tax advice, and should not be relied on take make financial, investment or taxation decisions. The information is based on proposed legislation and current publicly available information as of May 2025, which may be subject to change. Individuals should seek professional advice tailored to their specific circumstances before making any decisions.
Important Information
This provides general information only and does not constitute financial, investment, or tax advice, and should not be relied on to make financial, investment or taxation decisions. The information is based on proposed legislation and current publicly available information as of October 2025, which may be subject to change. Individuals should seek professional advice tailored to their specific circumstances before making any decisions.
Important Information
This provides general information only and does not constitute financial, investment, or tax advice, and should not be relied on to make financial, investment or taxation decisions. The information is based on proposed legislation and current publicly available information as of October 2025, which may be subject to change. Individuals should seek professional advice tailored to their specific circumstances before making any decisions.
Important Information
This webpage provides general information only and does not constitute financial, investment, or tax advice, and should not be relied on to make financial, investment or taxation decisions. The information is based on proposed legislation and current publicly available information as of October 2025, which may be subject to change. Individuals should seek professional advice tailored to their specific circumstances before making any decisions.
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