Transfer Balance Cap Indexation
Every individual has their own personal transfer balance cap of between $1.6 and $2.0 million, depending on their circumstances.
What is Transfer Balance Cap Indexation?
The general transfer balance cap is currently $2.0 million.
Every individual has their own personal transfer balance cap of between $1.6 and $2.0 million, depending on their circumstances.
If you start a retirement phase income stream for the first time on or after 1 July 2025, you will have a personal transfer balance cap of $2.0 million.
How does it work?
If you had a transfer balance account before 1 July 2025, your personal transfer balance cap will be:
- $1.6 million if, at any time between 1 July 2017 and 30 June 2025, the balance of that account was $1.6 million or more
- between $1.6 and $2.0 million in all other cases, based on the highest ever balance of your transfer balance account (known as proportional indexation).
Indexation of the general transfer balance cap changes other caps and limits that may apply to you, if you make:
- non-concessional contributions to your super
- a non-concessional contribution to your super and are eligible for a co-contribution
- a non-concessional contribution to super on behalf of your spouse and want to claim a tax offset
If | Then |
You start your first retirement phase income stream on or after 1 July 2025. | Your personal transfer balance cap will be $2.0 million. |
You started a retirement phase income stream before 1 July 2025. | Your personal transfer balance cap may increase slightly, based on the unused portion of your original cap. If your transfer balance account ever reached $1.6 million or more between 1 July 2017 and 1 July 2025, you won’t receive any indexation. |
You are receiving a child death benefit income stream that started before 1 July 2025, and you don’t have any other retirement phase income streams. | Your child death benefit transfer balance cap increment won't change. If you also receive another retirement phase income stream your personal transfer balance cap may increase slightly. |
You will be receiving income from a capped defined benefit income stream and:
| The money your fund withholds from your income stream may change. The defined benefit income cap will increase to $125,000 for most individuals. You may need to review the amounts from these income streams that you include in your income tax return. The maximum amount of the 10% pension tax offset you may be able to claim will increase. |
You make a non-concessional contribution to your super on or after 1 July 2017 and you have a superannuation balance of $2.0 million or more on 30 June 2025. | You will exceed your non-concessional contributions cap. |
You want to receive a government co-contribution after contributing to your fund on or after 1 July 2025, and you have a superannuation balance of less than $2.0 million on 30 June 2025. | You can if you meet all requirements. The limit to receive a co-contribution will increase from $1.6 to $2.0 million. |
You want to claim the spouse tax offset for super contributions and your spouse has a superannuation balance of less than $2.0 million on 30 June 2025. | You can if you meet all requirements. The spouse total superannuation balance limit will increase from $1.6 to $2.0 million. |
What should I be thinking about?
How indexation of the general transfer balance cap will affect you will depend on:
- whether you had a transfer balance account before 30 June 2023
- if you had a transfer balance account prior to indexation occurring and, at any time between 1 July 2017 and 30 June 2023, the balance of your account was $1.6 million or more
- if you had a transfer balance account prior to indexation occurring and the highest ever balance of your transfer balance account between 1 July 2017 and 30 June 2023 was never $1.6 million or more.
Important information regarding this information
This information is of a general nature. It does not consider your personal objectives, needs or situation. It does not represent legal, tax or personal advice and should not be taken as such. If it has been provided to you with a Statement of Advice (SoA), you should rely on the personal advice in the SoA.
Care has been taken to provide up to date and accurate information relating to the subject area however BR Advice Pty Ltd (ABN 30 612 056 523, AFSL 488655), Blue Rock Private Wealth Pty Ltd (ABN 95 166 927 055, AFSL 452733), and their representatives make no representation as to its accuracy or completeness.
Published: July 2025.
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