Division 296 Tax Calculator How much will you pay?
The proposed Division 296 tax is set to impact Superannuation balances exceeding $3 million, including self-managed Super funds (SMSFs). The Ord Minnett Division 296 Tax Calculator will help you understand how much the tax could cost you if it comes into effect.
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. Any earnings attributed to the portion of a Total Superannuation Balance (TSB) over $3 million will be taxed at a flat rate of 15%. Division 296 is an additional tax on top of the existing Super fund tax. The proposed Division 296 tax means you can be taxed on unrealised gains.
It's calculated based on the increase in your Total Super Balance (TSB), even if an asset hasn’t been sold to “lock in” these gains.
It’s important to note that Division 296 hasn’t been legislated yet. However, it is widely expected to pass into law in the future. If this happens, the first assessment for Division 296 will be based on an individual's TSB at the start and the conclusion of the 2025/26 financial year (1 July 2025 and 30 June 2026, respectively). 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:
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Division 296 Frequently Asked Questions
Basics & Definitions
Who does Division 296 affect?
Division 296 applies to people whose Total Superannuation Balance (TSB) is over $3 million at the end of the financial year. The new tax includes self-managed Super funds (SMSFs). If you take money out before that date and bring your balance below the threshold, the tax won’t apply. However, depending on your situation, you may still be taxed on withdrawing funds from your Superannuation.
You should seek professional financial advice before making decisions.
What are unrealised gains?
An unrealised gain is an increase in the value of an asset or investment that an investor holds, which has not yet been sold. For example, if an individual owns a property in their Superannuation fund which they purchased for $1 million, and the next financial year it is valued at $1.1 million, even though the asset has not been sold, they will pay tax on the unrealised gain of $100,000.
Under Division 296, unrealised gains can be taxed if your TSB is over $3 million.
What about defined benefit pensions?
If you have a defined benefit pension, its value will be counted towards your Super balance. Special rules apply, and any tax might be deferred in some cases.
Liability & Timing
Should I take money out of my Super if my balance is over $3 million?
Not necessarily. Withdrawing could trigger other taxes, like capital gains tax (CGT), and may affect your financial situation. 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 2026/27 financial year after the ATO reviews Superannuation earnings from the 2025/26 financial year. If you are in a self-managed Super fund (SMSF), the tax assessment will happen after your fund submits its return.
What if my Super balance goes down?
If your Super fund has negative growth (loses value), the loss can generally be carried forward and offset future earnings. This can help to reduce future tax payments.
Application & Scope
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. Some differences may apply for SMSFs compared to public fund members due to variations in how the funds are set up. For example, public fund members may request money from their fund to cover this tax. SMSFs are entirely responsible for their own tax obligations. While there are a few differences to keep in mind, Division 296 tax liabilities are broadly similar for SMSFs and public fund members.
Will the $3 million threshold increase over time?
No, the Government does not currently plan to index the tax or adjust it for inflation. Assuming the economy continues to inflate over time, it's likely that Division 296 will apply to more and more Australians.
Tax Calculation &
Payment Options
How do I pay this tax?
The Australian Taxation Office (ATO) will send you an official assessment once it receives your tax return and contribution information from your Super fund. You can pay the tax personally or request money from your Super fund to cover it.
What counts as my Super balance?
All funds in your Superannuation account and SMSF individual member balance count toward your Super balance. Some outstanding loan amounts linked to your Super, such as a Limited Recourse Borrowing Arrangement (LRBA) might not be included.
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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.
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